Green Control Transmission: 2026 Semi-Annual Report

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Suzhou Lvkong Transmission Technology Co., Ltd. 2026 Semi-Annual Report

2026-002

August 2026

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Section 1 Important Tips, Table of Contents and Definitions

The company's board of directors, directors and senior managers guarantee that the contents of the semi-annual report are true, accurate and complete, and that there are no false records, misleading statements or major omissions, and bear individual and joint legal liability.

Li Lei, the person in charge of the company, Wang Jinhuai, the person in charge of accounting work, and Ding Bangqin, the person in charge of the accounting department (accounting officer), declare that they guarantee the authenticity, accuracy and completeness of the financial report in this semi-annual report. All directors have attended the board meeting to review this semi-annual report.

The forward-looking statements such as future plans and development strategies involved in this report do not constitute the company's substantive commitment to investors. Investors and related parties should maintain adequate risk awareness and understand the differences between plans, forecasts and commitments.

The company details the risks and countermeasures that the company may face in the future in Section 3 "Management Discussion and Analysis" of this report. Investors are advised to pay attention to the relevant content and pay attention to investment risks.

The company plans not to distribute cash dividends, give away bonus shares, or convert public reserve funds into share capital.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Directory

Section 1 Important Tips, Table of Contents and Definitions......................................................................................................................2

Section 2 Company Profile and Main Financial Indicators......................................................................................................................6

Section 3 Management Discussion and Analysis......................................................................................................................................9

Section 4 Corporate Governance, Environment and Society......................................................................................................................22

Section 5 Important Matters................................................................................................................................................................24

Section 6 Changes in Shares and Shareholders...................................................................................................................29

Section 7 Bond-related situations................................................................................................................................................33

Section 8 Financial Report......................................................................................................................................................34

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Document directory for reference

1. Financial statements signed and stamped by the company’s legal representative, person in charge of accounting work, and person in charge of the accounting department (accounting supervisor);

2. The originals of all company documents and announcements publicly disclosed on the website designated by the China Securities Regulatory Commission and the designated newspaper during the reporting period;

3. The original copy of the 2026 semi-annual report and summary signed by the company’s legal representative and stamped by the company.

The place where the above documents are available for inspection: the office of the company’s board of directors.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Definition

Interpretation item refers to the interpretation content

Green Control Transmission, the Company, and the Company refer to Suzhou Green Control Transmission Technology Co., Ltd.

Guanfengyu refers to Suzhou Guanfengyu Venture Capital Center (Limited Partnership)

Guanxin Venture Capital refers to Suzhou Guanxin Venture Capital Center (Limited Partnership)

Sany Group refers to Sany Group Co., Ltd. and its entities under the same control Xuzhou Engineering Machinery Group Co., Ltd. and its entities under the same control Xugong Group refers to

the subject under

Dongfeng Motor Group Co., Ltd. and Dongfeng Motor Corporation, which are under the same control as Dongfeng Motor Group Co., Ltd., refer to

the subject under

Xiamen King Long Automobile Group Co., Ltd. and Xiamen King Long which belong to the same company refer to

subject under control

Beiqi Foton Motor Co., Ltd. and Beiqi Foton which are under the same control

the subject under

China National Heavy Duty Truck Group Co., Ltd. and China National Heavy Duty Truck Company, which are under the same control as China National Heavy Duty Truck Group Co., Ltd.

the subject under

Tepak refers to Tepak Power Technology Co., Ltd.

Fast refers to Shaanxi Fast Automobile Transmission Group Co., Ltd.

The electric drive system consists of a drive motor, power electronics and converts electrical energy into mechanical energy.

A system composed of related control devices

A series of zero powertrains that generate power on the vehicle and transmit it to the road.

General name of parts

An integrated system that deeply integrates machinery, motors, and control. The electromechanical coupling system refers to the cross-integrated design of multiple disciplines such as mechanics, electromagnetics, heat transfer, and control to achieve better system performance.

Automated Mechanical Transmission is an electronically controlled mechanical AMT

Abbreviation for automatic transmission

Double carbon refers to the abbreviation of carbon peak and carbon neutrality

Machinery used on non-road, including: machinery that can be both self-driven and non-road mobile refers to machinery that operates other functions; machinery that cannot be self-driven but is designed to be able to move from one place or be moved to another place. Road spectrum refers to the road pavement spectrum, which is the power spectral density curve of road unevenness. China Securities Regulatory Commission refers to China Securities Regulatory Commission.

Shenzhen Stock Exchange, Exchange, Stock Exchange refers to Shenzhen Stock Exchange

Ministry of Science and Technology refers to the Ministry of Science and Technology of the People's Republic of China

Ministry of Finance refers to the Ministry of Finance of the People's Republic of China

State Administration of Taxation refers to the State Administration of Taxation of the People’s Republic of China

CNAS refers to China National Accreditation Service for Conformity Assessment

Audit agency and accountant refer to Rongcheng Accounting Firm (Special General Partnership)

Outside the People's Republic of China, including the Hong Kong Special Administrative Region of China, and overseas refers to the Macao Special Administrative Region of China, Taiwan Region of China, and foreign countries and regions.

100 million yuan, 10,000 yuan, and yuan refer to 100 million yuan, 10,000 yuan, and 10,000 yuan.

Reporting period refers to January 1, 2026 to June 30, 2026

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Section 2 Company Profile and Main Financial Indicators

1. Company Profile

Stock abbreviation Green Control Transmission Stock code 301655 Stock abbreviation before change (if any) None

Stock exchange where stocks are listed Shenzhen Stock Exchange

The Chinese name of the company: Suzhou Lvkong Transmission Technology Co., Ltd.

Company’s Chinese abbreviation (if any) Green Control Transmission

The company’s foreign name (if any) Suzhou Lvkon Transmission Technology Co., Ltd. The company’s foreign name abbreviation (such as

LVKON

Yes)

The legal representative of the company Li Lei

2. Contact person and contact information

Name of Secretary of the Board of Directors Cao Jingyu

Contact address: No. 68, Yunchuang Road, Wujiang District, Suzhou City, Jiangsu Province

Phone 0512-88812073

Fax 0512-88812027

Email [email protected]

3. Other situations

1. Company contact information

Whether the company's registered address, company office address and its postal code, company website, e-mail address, etc. have changed during the reporting period □Applicable Not applicable

The company's registered address, company office address and its postal code, company website, e-mail address, etc. did not change during the reporting period. For details, please refer to the prospectus.

2. Information disclosure and preparation location

Whether the location of information disclosure and preparation changes during the reporting period

Applicable □Not applicable

The website of the stock exchange where the company discloses its semi-annual report Shenzhen Stock Exchange

"Securities Times", "Securities Daily", "Economic Information News", "China Daily" Media names and websites where the company discloses its semi-annual report "Shanghai Securities News", "Financial Times", "China Securities News", Juchao Information

Website (www.cninfo.com.cn) The company's semi-annual report is prepared at the company's board of directors office

3. Registration changes

Whether the registration status has changed during the reporting period

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

□Applicable Not applicable

The company's registration status did not change during the reporting period. For details, please refer to the prospectus.

4. Main accounting data and financial indicators

Whether the company needs to retroactively adjust or restate previous years’ accounting data

□Yes No

This reporting period The same period last year This reporting period increased or decreased operating income compared with the same period last year (yuan) 2,365,788,093.57 1,219,063,220.00 94.07% Net profit attributable to shareholders of listed companies

123,358,682.78 68,295,463.35 80.63% profit (yuan)

Deductions attributable to shareholders of listed companies

Net profit from non-recurring gains and losses 122,448,622.98 61,732,095.60 98.35% (yuan)

Net cash flow from operating activities

84,884,247.14 -61,646,856.43 237.69% (yuan)

Basic earnings per share (yuan/share) 0.32 0.18 77.78% Diluted earnings per share (yuan/share) 0.32 0.18 77.78% Weighted average return on equity 12.71% 10.43% 2.28%

End of the reporting period End of the previous year Total assets increased or decreased at the end of the reporting period compared with the end of the previous year (yuan) 5,845,683,559.66 4,489,803,887.01 30.20% of the net assets attributable to shareholders of the listed company

1,036,285,207.05 908,005,679.83 14.13% output (yuan)

Whether the company's share capital has changed from the end of the reporting period to the date of disclosure of the semi-annual report due to the issuance of new shares, additional issuance, rights issue, equity incentive exercise, repurchase, etc., and whether the amount of owner's equity has been affected

Yes □No

Preference stock dividends paid 0.00 Perpetual bond interest paid (yuan) 0.00 Fully diluted earnings per share calculated using the latest share capital (yuan/share) 0.2708

5. Differences in accounting data under domestic and foreign accounting standards

1. Differences in net profit and net assets in financial reports disclosed in accordance with both international accounting standards and Chinese accounting standards

□Applicable Not applicable

During the reporting period, there was no difference between the net profit and net assets in the financial reports disclosed in accordance with international accounting standards and Chinese accounting standards.

2. Differences in net profit and net assets in financial reports disclosed in accordance with both foreign accounting standards and Chinese accounting standards

□Applicable Not applicable

During the reporting period, there was no difference between the net profit and net assets in the financial reports disclosed in accordance with foreign accounting standards and Chinese accounting standards.

6. Non-recurring profit and loss items and amounts

Applicable □Not applicable

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Unit: Yuan

Item Amount Description of gains and losses from disposal of non-current assets (including accrued

-451,520.37 Offset portion of asset impairment provision)

Government subsidies included in current profits and losses (related to the company’s regular

Closely related to regular business operations and in compliance with national policies

1,519,044.78, enjoy according to the determined standards, and benefit the company

Except for government subsidies that have a lasting impact on profits and losses)

Except for effective transactions related to the company’s normal business operations,

In addition to futures hedging business, non-financial enterprises hold financial

Changes in fair value of assets and financial liabilities 311,889.85 Gains and losses and disposal of financial assets and financial liabilities

profit and loss

Gains and losses from debt restructuring -40,514.05 Other non-operating income and

-356,598.50 expenses

Less: Income tax impact 72,241.91 Total 910,059.80 Details of other profit and loss items that meet the definition of non-recurring gains and losses:

□Applicable Not applicable

The company has no other specific circumstances of profit and loss items that meet the definition of non-recurring profits and losses.

Explanation on defining the non-recurring profit and loss items listed in the "Explanatory Announcement No. 1 on Information Disclosure of Companies Publicly Offering Securities - Non-recurring Profit and Loss" as recurring profit and loss items

□Applicable Not applicable

The company does not define the non-recurring profit and loss items listed in the "Explanatory Announcement No. 1 on Information Disclosure of Companies that Offer Securities to the Public - Non-recurring Profit and Loss" as recurring profit and loss items.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Section 3 Management Discussion and Analysis

1. The main business of the company during the reporting period

(1) Development of the industry in which the company operates

1. The industry in which the company operates

The company is mainly engaged in the research and development, production and sales of electric drive systems for new energy commercial vehicles.

According to the "National Economic Industry Classification" (GB/T 4754-2017) issued by the National Bureau of Statistics, the company's main business industry is "C3670 Auto Parts and Accessories Manufacturing" of "C36 Automobile Manufacturing".

According to the "Classification of Strategic Emerging Industries (2018)" issued by the National Bureau of Statistics, the company's main business industry is "5.2.3 New Energy Automobile Parts and Accessories Manufacturing" of "5 New Energy Automobile Industry".

2. Development of new energy commercial vehicle industry

(1) Overview of the development of China’s new energy commercial vehicle industry

According to statistics from Kerui Consulting Research, China's new energy commercial vehicle sales will reach 982,900 units in 2025, a year-on-year increase of 61.86%, of which new energy truck sales will be 624,700 units and new energy passenger vehicles will be 358,200 units. From 2023 to 2025, the sales penetration rates of new energy commercial vehicles are respectively 11.27%, 19.45% and 28.84%. The trend of new energy sources for commercial vehicles is accelerating.

New energy buses first benefited from the promotion of "Ten Cities, Thousands of Vehicles" and are the earliest vehicle electrification demonstration field in China. They are currently in a mature stage of development. New energy buses are mainly pure electric models. The penetration rate of new energy buses in my country will reach 56.24% in 2024, which is already at a high level.

In the early stages of development, new energy trucks mainly relied on policy support such as subsidies and road rights to promote the development of the industry. In the past two years, as the entire industrial chain gradually matured and the cost of core components dropped, the economic advantages of new energy trucks became prominent, and new energy trucks ushered in a stage of rapid development. From 2023 to 2025, the penetration rates of new energy trucks are 6.96%, 12.32% and 21.85% respectively.

Among new energy trucks, the penetration rate of new energy heavy trucks has shown a significant increase. From 2023 to 2025, the sales penetration rates of new energy heavy trucks will be 5.57%, 13.61% and 28.87% respectively. Heavy trucks are the core means of transportation for road freight. They mainly use diesel and have obvious characteristics of high fuel consumption and heavy pollution. The proposal of the "dual carbon" goal, the implementation of the "National VI" emission standards and the tightening of fuel consumption regulations have promoted the transformation of traditional fuel heavy trucks into new energy. At the same time, driven by the decline in battery costs and the widening price difference between oil and electricity, the full life cycle economics of new energy heavy trucks have become increasingly prominent. Coupled with relevant policy support, the improvement of energy replenishment infrastructure, the rapid development of battery and charging and swapping technologies and power system-related technologies, as well as the replacement window brought about by the upward shift in the age structure of the existing vehicles and the elimination of National Five vehicles, the replacement process of old traditional models by new energy heavy trucks has significantly accelerated, and the new energy heavy truck market has ushered in endogenous growth. In 2025, my country's new energy heavy truck sales will reach 231,000 units, a year-on-year increase of 181.82%, and the average annual compound growth rate from 2018 to 2025 will reach 131.01%.

(2) China’s new energy commercial vehicle market is growing rapidly and has broad market development prospects.

Driven by multiple factors such as policy support, improved economics, improvement of energy replenishment networks, and technological progress, my country's new energy commercial vehicle sales and market penetration have increased rapidly. With the advancement of battery technology, vehicle cruising range has steadily increased, and its application scenarios have expanded from short-distance and short-distance to medium- and long-distance intercity trunk lines, express delivery, etc. The industry's willingness to proactively replace new energy sources has continued to increase, and the market's endogenous growth momentum is sufficient.

Compared with passenger cars, medium- and heavy-duty commercial vehicles have become the main emission source in the field of road transportation due to their heavy loads and high fuel consumption. According to research data from the "Commercial Vehicle Carbon Neutral Technology Roadmap 1.0", although the number of commercial vehicles accounts for only 12% of the total number of vehicles, their carbon emissions account for more than 55% of the total road traffic, which is a key link in achieving carbon emission reduction goals in the transportation field. Under the guidance of the national "double carbon" strategic goal, there is an urgent need for commercial vehicles to transform into new energy sources. With the technological progress related to new energy vehicles, the improvement of basic supporting facilities and the improvement of economic efficiency, the trend of new energy sources for commercial vehicles will continue to strengthen, and the market development prospects are broad.

At present, the sales penetration rate of new energy commercial vehicles in my country is still low. In 2025, the sales penetration rate of new energy commercial vehicles in China is 28.84%. Referring to the penetration rate of new energy passenger vehicles, there is considerable room for improvement in the future market penetration rate of new energy commercial vehicles. According to the "Energy Saving and New Energy Vehicle Technology Roadmap 3.0" plan, 2040 New Energy has set a sales plan for my country's new energy commercial vehicles in stages for 2030, 2035 and 2040. my country's new energy commercial vehicle market faces huge development opportunities, as follows:

major milestones

2030 2035 2040

(New energy commercial vehicles)

Sales of new energy commercial vehicles account for 1% of commercial vehicles

About 30% About 55% About 75%

Proportion of annual sales of new cars

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

(3) In line with the development opportunities of global new energy vehicles, China has become the main driving force in the global vehicle electrification process.

Against the background of my country's urgent need for energy transformation, the new energy vehicles and key parts industries, as key components of the national strategic emerging industries and new productivity, receive systematic policy support from the state in terms of strategic planning, financial subsidies, tax exemptions, etc. Relying on its complete domestic industrial chain and scale advantages, my country is actively promoting the "going out" of new energy vehicle products and technical standards through international cooperation initiatives such as the "Belt and Road" initiative, and participating in and leading the global green transportation transformation.

(2) The company’s main business situation

1. Overview of main business

The company is one of the leading companies in electric drive systems for new energy commercial vehicles in China. Based on technological innovation related to electric drive systems, it provides customers with the development and services of electric drive systems, components and related technologies. Electric drive systems are the driving force source and core key components of new energy vehicles and non-road mobile machinery, including motors, automatic transmissions and various controllers, electric drive axles, etc. The core products and components developed by the company have the advantages of high reliability, high efficiency, integration and lightweight, and are widely used in the fields of commercial vehicles and non-road mobile machinery under new energy technology routes such as pure electric, plug-in hybrid (including extended range) and fuel cells.

The company has overcome multiple technical difficulties in the field of pure electric and hybrid drive systems for commercial vehicles. The company adheres to the concept of "safety and efficiency defines electric drive" and always adheres to technological innovation. It has formed a series of core technology accumulation in electric drive system assembly architecture design, electric drive system assembly control strategy technology, electric drive special transmission development technology, high torque density and high efficiency drive motor technology, and controller technology. The company's independently developed coaxial parallel hybrid electromechanical coupling system based on the AMT transmission achieves independent controllability of key components. In 2019, the company, as one of the main completion units of this technology, jointly won the second prize of the National Science and Technology Progress Award with Tsinghua University and other units; the company's power uninterrupted drive system based on dual-input transmissions solves the difficulty of importing key components such as traditional large-scale 100-ton mining truck engines and automatic transmissions. The company has made useful contributions to the problem, and the relevant technology is at the leading level; the company's high-efficiency multi-mode integrated electric drive axle product for heavy trucks has changed the traditional central drive "motor + transmission + transmission shaft + axle" layout, deeply integrating key components such as motors, transmissions, and axles, improving system efficiency, reducing weight, shrinking size, and improving multiple performance indicators of the entire vehicle. This product solution provides a new technical path for the development of a chassis dedicated to pure electric heavy trucks.

The company's technology transformation has achieved remarkable results. The electric drive system products formed by the company's core technology have excellent performance and significant advantages in economy and power. The company is a national high-tech enterprise and has won honors such as the National Manufacturing Single Champion Enterprise and the Specialized and New "Little Giant" Enterprise. It has a national postdoctoral research station and a CNAS certified laboratory. It has been recognized by Jiangsu Province as an Enterprise Technology Center, Jiangsu Province Engineering Technology Research Center and Jiangsu Province New Energy Commercial Vehicle Electric Drive System Engineering Research Center. It has undertaken 10 national or provincial projects such as national key R&D plans, national major science and technology projects, and Jiangsu Province major scientific and technological achievements transformation projects. As of June 30, 2026, the company and its subsidiaries had 374 domestic authorized patents, including 69 invention patents, 279 utility model patents, 26 design patents, and 43 software copyrights. The company presided over or participated in 3 national standards, 11 group standards, 1 industry standard, and 1 local standard.

The products formed by the company's technology transformation have high market recognition. The independently developed electric drive system can realize product matching under the pure electric (including fuel cell) and hybrid technology routes. It is mainly used in commercial vehicles and gradually expanded to the field of non-road mobile machinery, and has been highly recognized by well-known downstream customers. The company's customers include Xugong Group, Sany Group, Dongfeng Motor, Xiamen Kinglong, Beiqi Foton, China National Heavy Duty Truck, Zoomlion and other enterprises. The company is also actively developing the international market, and its products have been sold to some other Asian countries, Europe and the United States and other overseas markets. According to the insurance data statistics surveyed by Kerui Consulting, from 2023 to 2025, the company's new energy heavy truck motor supporting market share will continue to rank first in the industry, with obvious industry leading advantages.

2. Main products

The company's main product is the electric drive system for new energy commercial vehicles. The electric drive system for new energy commercial vehicles consists of a motor, a controller and an automatic transmission. Its function is equivalent to the engine of a traditional fuel vehicle. It is the core component that realizes the conversion of electrical energy into kinetic energy, power output and precise control. It has a key impact on the vehicle's driving performance, service life, and driving safety and comfort. The company's products are mainly used in pure electric, hybrid and fuel cell commercial vehicles and off-road mobile machinery. The architecture and principles of the new energy commercial vehicle power system are as follows:

Figure: Schematic diagram of heavy truck central electric drive system

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Figure: Schematic diagram of heavy truck electric drive axle

The company's main products are divided into pure electric drive systems and hybrid drive systems, as follows:

Pure electric drive system

Serial number Product Product picture Features The application model adjusts the torque of the motor through a multi-speed transmission to reduce power consumption.

TED series (based on

reduce machine weight and cost; intelligent shift control allows the motor to work. Trucks and engineering machines 1 AMT’s pure electric system

Reduce power consumption in more efficient areas; motors, electronic controls, variable mechanical systems)

The speed controller is highly integrated, reducing installation space and improving reliability.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

High degree of integration can greatly improve space utilization and facilitate electric

The car battery and other components are arranged to make full use of the vehicle space.

STEA series (electric drive light passenger, light truck, 2 Reduce vehicle weight, increase vehicle carrying capacity; reduce transmission shaft

bridge) heavy trucks, mining trucks and other components to achieve better lightweight, higher efficiency and more

High reliability

Adopt nested shaft dual output motor to match dual input transmission method

case, the two motors can work at the same time or alternately, and the expansion

CED series (pure electric

3. The motor has an efficient working area to reduce power consumption; dual power input at the same time (non-interruption system for heavy truck and mining truck power)

Achieve uninterrupted shifting power and improve the smoothness of shifting of the entire vehicle

and hill climbing dynamics

hybrid drive system

Serial number product picture advantage application model

Using single motor and electronic control, light weight; through multi-speed transmission

PHD series (parallel hybrid bus, light truck, 1 Torque adjustment and working point optimization of motors and engines,

Combined power system) Good adaptability to medium and heavy truck road conditions

Dual motor series-parallel architecture, with series hybrid and parallel hybrid

All functions, better adaptability to working conditions; dual-input variable speed

CHD series (power is not

so that when one power source shifts gears, the other power source can light truck, heavy truck, 2 interrupt hybrid power system

Perform power compensation to achieve uninterrupted shifting power and improve the overall mining system)

The car's shifting smoothness and climbing dynamics; the dual motors coordinate

operation, always ensuring that the motor works in the high-efficiency zone and reducing energy consumption

(3) Business model

1. Sales model

The company mainly provides electric drive systems to customers of new energy commercial vehicles and off-road mobile machinery, sells a small number of parts to customers, or provides technical development services related to electric drive systems, focusing on sales in the domestic market.

(1) Product sales model

The company adopts a proactive marketing strategy, is guided by industry development trends and market demand, and conducts product development, trial production, and testing based on customer needs. After providing samples to customers and obtaining approval, the company signs agreements with customers, supplies in batches, and provides related services.

The company sells products to customers through a direct sales model. After customers place demand orders, they are shipped directly to designated locations. For some customers, consignment is used, that is, the company sends products to designated third-party warehouses or customer warehouses according to customer instructions, and customers use consignment products according to actual needs.

(2) Technology R&D service model

The company provides technology research and development services to customers, that is, it accepts entrustment to carry out research and development and testing services during the cooperation process.

2. R&D model

The company attaches great importance to technological innovation and implements an independent innovation R&D model. The company has set up an R&D department to carry out R&D based on market and technology development trends and customer needs. It has established a complete R&D system and a comprehensive collaborative R&D process.

(1) R&D system

1. Internal R&D

The company is guided by market demand and pursues efficiency, reliability, economy and lightweight in product research and development. The company has formed a "three-in-one" R&D system, including forward-looking modular new product development, technological transformation of existing products, and iterative upgrades of key technologies. The details are as follows: ① For new product development, the company proactively deploys cutting-edge product research and development based on industry development trends, market demands, and user usage surveys. It seeks common application characteristics for different models in each applicable scenario, and integrates modular and standardized design ideas into the component development process. After the solution is designed, A simulation matching test is carried out. After passing the test, prototype manufacturing, verification testing and optimization and upgrading are carried out. The research and development cycle of new products is about 2-3 years; ② For existing stock products, the company combines customer feedback and technology development predictions to transform and upgrade, and the research and development cycle is generally about 1 year; ③ Based on five core technologies such as system architecture technology, control strategy technology, and special automatic transmission technology, it continues to rapidly iterate and upgrade to enhance the core competitiveness of products. In addition to product research and development, the company focuses on the research and development of basic core technologies, such as the research and development and use of new materials, special algorithm design, and the research and development and reserve of system control technology.

2. Collaborative research and development

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

The company attaches great importance to cooperating with universities and leading vehicle or equipment companies to carry out research and development projects to achieve cooperative research on new technologies and new products.

(2) R&D process

The company's product research and development project process is divided into four stages: project establishment, prototype trial production, mold trial production and small batch production, as follows:

3. Procurement model

(1) Procurement method

The raw materials and components required for the company's production and operation mainly include motor controllers, magnets, gear shafts, casings, enameled wires, silicon steel, bearings, chips and other raw materials. The company purchases and prepares materials based on annual plans and specific customer order requirements to ensure adequate reserves and timely turnover of materials. The company's production planning management department formulates annual procurement plans based on its own material reserves, customer needs and supplier production capacity, and calculates the safety stock boundaries of various materials to form an overall arrangement for the purchase volume and procurement cycle of various materials. When customers actually place orders and the company organizes production, the production planning and management department coordinates and issues purchasing instructions, and the purchasing management department executes the material purchases.

(2) Supplier development and management

In order to ensure product quality, the company formulates and implements procurement control procedures, supplier development management and performance appraisal regulations to standardize procurement behavior.

The company develops and selects suppliers through comprehensive inspections. First, the procurement department collaborates with the R&D department and quality department to determine requirements and classify potential suppliers based on market evaluation; secondly, the company collects supplier information and conducts a preliminary assessment of the supplier's financial strength, supply capacity and service quality; then, through on-site inspections, it selects high-quality suppliers by comprehensively considering the supplier's operating qualifications, production conditions, product performance, delivery capabilities and industry evaluation and other factors; finally, combined with commercial negotiations, it determines whether to include the supplier in the list of qualified suppliers by considering the stability and preferential conditions of cooperation between the two parties. The company conducts regular assessments and implements active management based on supplier performance.

4. Production mode

The company's production plan and procurement plan match. The production plan management department formulates annual production plans based on market development trends, customer needs and its own production capabilities, and arranges classified production based on production time and degree of material standardization. Generally, materials with longer production cycles and semi-finished products with a higher degree of standardization are produced and reserved in advance; when customers confirm their needs and sign a batch supply agreement, the company's production department develops plans and organizes production according to orders placed by customers.

The company mainly focuses on independent production, supplemented by outsourcing processing. The company has many production and processing links and a long industrial chain. Its core components such as motors, automatic transmissions and controllers are produced independently, involving core processes such as gear and casing processing, heat treatment, and assembly. At the same time, the company also purchases some parts, completes the assembly and testing of the complete product, and achieves rapid delivery through production scheduling. The company's production management center has a production planning management department, which is responsible for formulating production plans and coordinating and controlling production progress. Based on the consideration of professional division of labor, the company completes some rough processing, patching and other processes through outsourcing.

(4) Market position

The company is one of the domestic leaders in electric drive systems for new energy commercial vehicles and occupies an important market position in the field of new energy heavy trucks. According to Kerui Consulting's research data, in 2023, 2024 and 2025, the company's new energy heavy truck motor supporting market share will continue to rank first in the industry, with obvious industry leading advantages.

Participants in China's new energy commercial vehicle electric drive system industry include vehicle manufacturers and third-party electric drive system suppliers. Major players in the domestic new energy heavy truck electric drive system market include Green Control Transmission, Tepika and Fast. As my country's commercial vehicle industry transforms and upgrades and develops towards the application of new energy technologies, the market demand for electric drive systems for new energy commercial vehicles in China continues to increase. As a national high-tech enterprise, a national manufacturing champion, and a "little giant" enterprise that specializes in new energy, the company has long been deeply involved in the field of new energy electric drive systems and has mastered a series of key technologies in drive motors, transmissions and control systems. Relying on its advantages in technology, technology and services, the company has become the mainstream powertrain for leading manufacturers in the new energy commercial vehicle industry such as Xugong Group, Sany Group, Dongfeng Motor, and Xiamen Kinglong.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

System suppliers, among which, Sany Group and Xugong Group rank among the top two in new energy heavy truck vehicle sales in 2025, with their combined market share reaching 29.93%.

2. Analysis of core competitiveness

(1) Outstanding R&D advantages

Since its establishment, the company has attached great importance to R&D and innovation, and has always regarded technological progress as the driving force for development. Strong R&D capabilities are the core for the company to maintain competitive advantages and sustainable development in the industry. Relying on a professional R&D team and a complete R&D system, the company carries out forward-looking R&D layout around key technology theoretical systems and industrialization experience.

1. First-mover advantages in the industry and long-term experience accumulation

The company's R&D team has been working in the fields related to new energy electric drives for more than ten years. It has relevant R&D and application experience in a variety of electric drive product fields. It has conducted in-depth research and comparisons on various technical routes and formed product solutions for different models and scenarios. After more than ten years of technology research and development, the company has accumulated a rich database including complex road map data, operating condition data of various vehicle models and driver operating habits. It has a deep understanding of the core components of electric drive systems and their matching applications, and has formed in-depth theoretical and practical accumulation in various pure electric and hybrid drive system configurations. The company is also one of the first domestic companies to achieve mass production of hybrid and pure electric drive systems for commercial vehicles. It has achieved large-scale operations and has rich industrialization experience.

2. Professional R&D personnel team

The development of new energy electric drive systems involves multiple disciplines such as materials, machinery, fluids, power electronics, vehicle dynamics, and software development. System design places high professional requirements on R&D personnel. The company has always attached great importance to the cultivation of R&D talents and team building, and continuously improved and strengthened the strength of the R&D team. As of June 30, 2026, the number of R&D personnel was 392, accounting for 16.04% of the total number of employees at the end of the period. The R&D team and core technical personnel come from Tsinghua University and Nanjing University of Aeronautics and Astronautics, among which the company’s founder Dr. Li Lei graduated from Department of Automotive Engineering, Tsinghua University, won the second prize of the National Science and Technology Progress Award and the first prize of the Beijing Science and Technology Award. As the project leader, he undertook 1 major national science and technology project and 1 national key R&D plan. As the project leader, he undertook 4 national ministry plans and 2 provincial science and technology projects. He was selected as the "Technology Innovation and Entrepreneurship Talents of the Innovative Talent Promotion Plan" of the National Ministry of Science and Technology.

3. Complete R&D and innovation capabilities

The company has a complete R&D organization and methods, with technical teams such as structural development, electronic hardware development, system architecture development, software development, experimental testing and process development. It has research and development capabilities that integrate mechanical design, electronic control unit development, computer simulation, bench testing and vehicle road testing, covering hybrid powertrains, pure electric powertrains, transmission bodies and controllers, drive motors, shift and clutch actuators, vehicle controllers and other assemblies and core component products.

(2) Industry-leading technical advantages of electric drive system assembly

1. Outstanding technical achievements

The company has always adhered to technological innovation and continuously improved its research and development level. After long-term independent research and development, it has formed a series of core technology accumulation in the field of new energy commercial vehicle electric drive systems, and mastered the electric drive system assembly architecture design technology, electric drive system assembly control strategy technology, electric drive special transmission development technology, high torque density and high efficiency drive. Motor technology and controller technology. Among the many core technologies, the company's independently developed coaxial parallel hybrid electromechanical coupling system based on AMT transmission, heavy truck pure electric drive system based on AMT transmission, power uninterruptible drive system based on dual input transmission and efficient multi-mode integrated electric drive axle system have significant technical advantages.

2. Rich technical achievements

Through long-term continuous investment in R&D, the company has achieved rich R&D technological achievements. The company is a national high-tech enterprise and has won honors such as the national manufacturing champion enterprise and the "Little Giant" enterprise specializing in new technologies. It has a national postdoctoral research station and a CNAS certified laboratory. It has been recognized as a Jiangsu Provincial Enterprise Technology Center, a Jiangsu Provincial Engineering Technology Research Center and a Jiangsu Provincial New Energy Commercial Vehicle Electric Drive System Engineering Research Center. It has undertaken national or provincial-level national key R&D plans, major national science and technology projects, and major scientific and technological achievement transformation projects in Jiangsu Province. 10 projects; as one of the main participating units, it has won the first prize of the Beijing Science and Technology Award and the second prize of the National Science and Technology Progress Award; as of June 30, 2026, the company and its subsidiaries have 374 domestic authorized patents, including 69 invention patents, 279 utility model patents, 26 design patents, and 43 software copyrights. The company presides over or participates in 3 national standards, 11 group standards, 1 industry standard, and 1 local standard.

(3) Advantages of product portfolio with excellent performance, complete range, economy and reliability

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Based on long-term technology research and development accumulation, in response to customer needs and determined development goals, the company is able to develop a new energy commercial vehicle electric drive system that best matches the target model in terms of vehicle power, economy and comfort. After long-term accumulation and iteration, the company has formed a relatively complete new energy electric drive system product system.

1. The electric drive system has high performance

Relying on leading technology, the company's technology transformation results are obvious, and the technical parameters of the electric drive system are at the advanced level in the industry. Under the pure electric technology solution, the company independently developed the TED series (pure electric system based on AMT), STEA series (electric drive axle) and CED series (pure electric power uninterrupted system), which have the characteristics of high torque power density, high efficiency, good ride comfort and low noise. Under the hybrid technology solution, the company's independently developed PHD series (parallel hybrid system) and CHD series (power-continuous hybrid system) products have the characteristics of high efficiency, high fuel saving rate, strong power, and strong adaptability to working conditions.

2. Rich product portfolio and comprehensive application scenarios

After years of continuous development and improvement, the company's existing product categories are complete and widely used. The electric drive system technical solutions include pure electric and hybrid power. Different power coupling configurations and component configurations enable the use of the products in different models and corresponding scenarios. The products are widely used in various types of commercial vehicles and have been expanded to non-road mobile machinery, including: in commercial use The vehicle field covers heavy-duty trucks used for infrastructure transportation, logistics transportation, urban sanitation, etc., bus vehicles mainly used for urban travel, and various types of vehicles such as medium trucks and light trucks mainly used for urban and urban and rural logistics transportation. In the field of non-road mobile machinery, various supporting products such as mining trucks, engineering machinery, and port machinery have been developed based on different working conditions.

3. Independent research and production of parts and components is conducive to providing economical and reliable assembly products.

The company can independently develop and produce core components in the electric drive system, including the transmission body and controller, motor and vehicle controller. The independent control of key components can effectively ensure the performance and quality requirements of the assembly product.

(4) Advantages of intelligent process manufacturing with efficient collaboration and independent production

Downstream customer orders in the new energy commercial vehicle electric drive system industry are characterized by multiple varieties, small batches and high delivery speed requirements. In order to adapt to and meet customer order requirements, the company improves production and delivery efficiency by developing and producing modular core components or semi-finished products. The company has assembly assembly, motor, controller, transmission and other production workshops as well as key parts manufacturing centers, which effectively ensures and enhances the control capabilities of the supply chain and production process. The core components and assembly products are produced in separate production lines, forming a highly collaborative supply and production system.

The company actively explores the intelligent and digital transformation of manufacturing plants, builds a production system based on digital manufacturing and automation equipment, fully implements the application of intelligent product manufacturing models, promotes the construction of intelligent factories, and has a high networking rate of production plant equipment. In 2018, 2020, 2023 and 2024, it was selected as the "Jiangsu Province Demonstration Intelligent Workshop", "Suzhou City Smart Factory", "Jiangsu Province Intelligent Manufacturing Demonstration Factory" and "Suzhou City 3A Green Factory" respectively.

(5) Advantages of rich and high-quality customer resources

The company's products have a wide range of application scenarios and a diverse customer structure. With excellent product performance, stable product quality and high-quality after-sales service, the company has established good cooperative relationships with customers and gradually expanded overseas customers, gaining high recognition from well-known customers at home and abroad.

The company's service customers include commercial vehicle manufacturers and non-road mobile machinery manufacturers. There are many well-known customers, including Xugong Group, Sany Group, Dongfeng Motor, Xiamen King Long, Beiqi Foton, China National Heavy Duty Truck, Zoomlion and other enterprises.

3. Main business analysis

Overview

In the first half of 2026, the total automobile market is under pressure, the shrinkage of fuel vehicles has accelerated, and the penetration rate of new energy has reached a new high. The cumulative sales of new energy vehicles exceeded 7 million units, and the structural differentiation of "electricity in and oil out" continued to intensify; the cumulative sales of new energy commercial vehicles in the first half of the year reached 526,000 units, a year-on-year increase of 44.4%, and the penetration rate reached 30.4%; among them, the cumulative sales of new energy heavy trucks in the first half of the year were 140,000 units, a year-on-year increase of 76.6%, and the penetration rate reached 33.7%, continuing to grow rapidly. The electrification penetration process in the new energy commercial vehicle market continues to accelerate, and it is widely deployed in light passenger vehicles, light trucks and heavy truck tracks. The industry is accelerating its comprehensive transformation from "policy-driven" to "market-driven".

During the reporting period, the company achieved operating income of 2,365.7881 million yuan, an increase of 94.07% over the same period last year; a total profit of 131.7287 million yuan, an increase of 80.08% over the same period last year; The net profit of shareholders of the municipal company was 123.3587 million yuan, an increase of 80.63% over the same period last year; the net cash flow generated from operating activities was 84.8842 million yuan, an increase of 237.69% over the same period last year.

Year-on-year changes in major financial data

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Unit: Yuan

This reporting period The same period last year Year-on-year increase or decrease Reasons for changes

Mainly due to the increase in penetration rate of new energy commercial vehicles operating income 2,365,788,093.57 1,219,063,220.00 94.07%

High, due to the rapid growth of the company’s business

Mainly due to the expansion of revenue during the reporting period, operating costs 2,024,947,676.34 982,803,642.58 106.04%

Due to the corresponding increase in costs

Selling expenses 47,423,779.34 37,961,890.40 24.92%

Management expenses 41,752,189.89 37,808,341.91 10.43%

Mainly due to the rapid growth of the company's business, financial expenses 17,573,025.63 9,651,746.53 82.07%, the corresponding increase in demand, the company increased bank loans, resulting in an increase in interest expenses

Mainly due to the increase in company profits resulting in income tax expenses 8,369,978.63 4,854,082.48 72.43%

Due to the corresponding increase in income tax

Mainly due to the company's increased investment in R&D technology R&D investment 85,146,778.40 50,418,186.14 68.88% and the rapid growth of personnel scale, resulting in a corresponding increase in R&D expenses

Mainly due to the expansion of the company's revenue scale and cash generated from operating activities

84,884,247.14 -61,646,856.43 237.69% Strengthen accounts receivable management, net customer repayment flow

Caused by continued increase

The cash generated from investing activities is mainly due to the company’s expansion of production capacity in the current period.

-284,978,744.96 -153,744,174.43 -85.36%

Net flow Cash generated from financing activities due to increased investment in fixed assets Mainly due to the increase in bank borrowings and returns in the current period

528,768,379.96 395,149,529.60 33.81%

Net flow due to decrease in bank borrowings

Net cash and cash equivalents Mainly due to the increase in net inflow of bank borrowings in the current period

327,989,662.13 179,758,498.74 82.46%

The increase was due to the increase in customer repayments.

There are major changes in the company's profit composition or profit sources during the reporting period

□Applicable Not applicable

There were no major changes in the company's profit composition or profit sources during the reporting period.

Products or services accounting for more than 10%

Applicable □Not applicable

Unit: Yuan

Operating income is higher than operating cost is higher than gross profit margin is higher than operating income Operating cost is higher than gross profit margin

Increase/decrease over the same period of the year Increase/decrease over the same period during the year

Electric drive system-goods

2,028,869,475.43 1,783,826,114.89 12.08% 115.84% 121.97% -2.43%Car

Electric drive system-customer

51,767,633.51 30,491,807.26 41.10% 16.72% 22.54% -2.80%Car

Electric drive system-non

162,581,928.21 108,478,021.15 33.28% 13.29% 26.16% -6.81% Road mobile machinery

Parts and accessories 48,350,868.66 34,506,021.43 28.63% 49.86% 27.32% 12.63% By region

Domestic 2,286,846,796.64 1,959,106,210.55 14.33% 94.42% 105.61% -4.67% Overseas 26,463,565.49 13,181,577.16 50.19% 118.95% 88.49% 8.05%

4. Analysis of non-main business

Applicable □Not applicable

Unit: Yuan

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Amount Proportion of total profit Explanation of reasons Whether it is sustainable

Mainly bank acceptance bill stickers

Investment income -3,199,814.65 -2.43% is current interest and financial management income

Mainly in accordance with company accounting policies

Asset impairment -32,528,540.71 -24.69% Provision for bad debts and inventories Yes

Due to price fall preparation

Non-operating income 76,193.59 0.06% Mainly income from penalties and confiscation No

Mainly the scrapping of non-current assets

Non-operating expenses 1,082,848.48 0.82% No

Losses and donation expenses, etc.

5. Analysis of assets and liabilities

1. Major changes in asset composition

Unit: Yuan End of the reporting period End of the previous year Increase or decrease in proportion of major changes

Amount Proportion of total assets Amount Proportion of total assets Description Monetary funds 600,823,941.59 10.28% 275,784,245.96 6.14% 4.14% -Accounts receivable 1,700,398,182.57 29.09% 1,484,468,771.97 33.06% -3.97% -Contract assets 18,247,821.28 0.31% 15,920,795.35 0.35% -0.04% -Inventory 1,046,735,041.92 17.91% 800,337,167.66 17.83% 0.08% -Investment real estate 53,137,410.93 0.91% 54,895,288.83 1.22% -0.31% -Fixed assets 806,838,096.18 13.80% 605,507,584.60 13.49% 0.31% -Construction in progress 203,404,490.65 3.48% 172,254,255.59 3.84% -0.36% -Right-of-use assets 6,459,056.83 0.11% 8,304,501.67 0.18% -0.07% -Short-term borrowings 1,411,549,575.31 24.15% 789,866,323.73 17.59% 6.56% -Contract liabilities 11,451,156.82 0.20% 8,386,403.90 0.19% 0.01% -Long-term borrowings 124,735,310.34 2.13% 49,605,265.98 1.10% 1.03% -Lease liabilities 1,970,960.68 0.03% 3,907,071.36 0.09% -0.06% -

2. Major overseas assets

□Applicable Not applicable

3. Assets and liabilities measured at fair value

□Applicable Not applicable

4. Restrictions on asset rights as of the end of the reporting period

Item Ending balance Ending book value Reason for restriction

Fixed assets 193,556,889.54 193,556,889.54 Loans and mortgages

Intangible assets 68,785,276.83 68,785,276.83 Loan mortgage

Investment real estate 50,724,470.94 50,724,470.94 Loan mortgage

Monetary funds 10,582,565.06 10,582,565.06 Margin

Notes receivable discounted or endorsed at the end of the period but not yet due Notes receivable 623,162,869.28 623,162,869.28

According to the unterminated confirmation amount

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Total 946,812,071.65 946,812,071.65 -

6. Investment status analysis

1. Overall situation

Applicable □Not applicable

Investment amount during the reporting period (yuan) Investment amount during the same period last year (yuan) Change range

407,952,639.95 217,486,472.48 87.58%

2. Major equity investments obtained during the reporting period

□Applicable Not applicable

3. Major non-equity investments ongoing during the reporting period

□Applicable Not applicable

4. Financial assets measured at fair value

□Applicable Not applicable

5. Usage of raised funds

□Applicable Not applicable

The company has no use of raised funds during the reporting period.

6. Entrusted financial management and derivatives investment

(1) Entrusted financial management situation

Applicable □Not applicable

Overview of entrusted financial management during the reporting period

Unit: 10,000 yuan

Product Category Risk Characteristics Balance of entrusted financial management during the reporting period Overdue amount not recovered Bank financial management products Low risk 0 0 The company entrusts a financial institution to carry out asset management as a single client, or invests in high-risk entrusted financial management with low security and poor liquidity. Specific circumstances □ Applicable  Not applicable

(2) Derivatives investment situation

□Applicable Not applicable

The company had no derivative investments during the reporting period.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

7. Sale of major assets and equity

1. Sale of major assets

□Applicable Not applicable

The company did not sell any major assets during the reporting period.

2. Sale of major equity interests

□Applicable Not applicable

8. Analysis of major holding and participating companies

Applicable □Not applicable

Information about major subsidiaries and joint-stock companies that affect the company's net profit by more than 10%

Unit: yuan Company name Company type Main business Registered capital Total assets Net assets Operating income Operating profit Net profit Wujiang Green Holdings

Manufacturing 20,000,00 261,842,1 147,571,2 83,907,90 17,597,10 16,004,67 Electronic Control Technology Subsidiary

Sales 0 50.42 48.61 9.78 3.16 6.22 Co., Ltd.

Acquisition and disposal of subsidiaries during the reporting period

□Applicable Not applicable

Description of major holding and joint-stock companies

9. Structured entities controlled by the company

□Applicable Not applicable

10. Risks faced by the company and countermeasures

(1) Risks of fluctuations in market demand for new energy commercial vehicles

The market demand for new energy commercial vehicles is closely related to macroeconomic development and industrial policies. If there is a macroeconomic downturn in the future, adjustments to industrial policies, less than expected progress in the construction of charging supporting facilities, vehicle purchase tax and other policy impacts, or the development of key technologies such as batteries and lightweighting is slower than expected, it may cause the development of the new energy commercial vehicle industry to slow down, and downstream market demand will decline accordingly, which may have an adverse impact on the company's operations and development.

Countermeasures: The company will continue to track macroeconomic, industrial policy and other developments, study and judge market and technological development changes in advance, optimize business strategies, and enhance business resilience. Strengthen the R&D layout in the technical field, improve product performance and comprehensive competitiveness, continuously enrich the product matrix, and expand diversified application scenarios; strengthen cost control and supply chain management, improve anti-cyclical capabilities, and hedge against possible adverse effects caused by slowing industry growth and declining downstream demand.

(2) Risks of competition in the new energy electric drive system industry

In recent years, the demand for new energy vehicles has continued to increase, driving the rapid development of the industrial chain. As one of the core components of new energy vehicles, new energy electric drive systems have good development trends and industry prospects. Domestic and foreign new energy electric drive system manufacturers are accelerating the development of related products and increasing investment in technology research and development. Competition among companies in the new energy electric drive system industry is becoming increasingly fierce.

Countermeasures: The company will continue to increase investment in research and development, iteratively upgrade electric drive products, and consolidate technological advantages; focus on diverse application scenarios of commercial vehicles to promote product customization and development, stabilize core customers and expand new customers; achieve cost reduction and efficiency increase through process optimization and refined supply chain management and control, keep up with market changes and quickly respond to customer needs, comprehensively improve comprehensive competitiveness, and hedge against the adverse effects of intensified industry competition.

(3) Risk of raw material price fluctuations

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

The company's main product is electric drive system assembly, and production requires the purchase of motor controllers, magnets, casings, gear shafts and other raw materials. Among the company's main raw materials, the purchase prices of magnetic steel, shells, enameled wires, silicon steel, aluminum ingots, etc. are relatively related to the market prices of bulk commodities such as praseodymium and neodymium metals, aluminum, copper, iron ore, and coke. The latter is affected by macroeconomic conditions, market supply and demand, geopolitics and other factors, and there is a certain degree of volatility. If the price of raw materials increases due to commodity market prices, it will affect the company's product costs. If the company cannot transmit the impact of price changes to the downstream in a timely and sufficient manner, it will affect the gross profit margin level of the company's products and adversely affect the company's production operations and profitability.

Countermeasures: The company will hedge the risk of raw material price fluctuations through a combination of procurement price lock-in and price negotiation, production cost reduction and efficiency improvement, sales structure optimization and operating expense control. On the procurement side, the company strives for room for price reductions through phased bidding, signing price lock agreements, regular price negotiations, etc., and at the same time reasonably arranges procurement timing and inventory preparation plans based on price predictions; on the R&D and production side, the company improves material utilization through lightweighting and optimizing material usage, improving mold design, etc., and promotes Integrate intelligent manufacturing to reduce unit labor and manufacturing costs; on the sales side, promote high value-added products and high-margin series products, and negotiate price adjustments with customers when raw material prices rise beyond the threshold; on the operation side, strengthen cost control, continue to reduce period expense rates through refined management, and enhance the overall anti-risk level.

(4) Technology research and development risks

Sufficient R&D investment plays an important role in maintaining technological advantages, developing advanced products and increasing market share for companies in the electric drive system industry. The company closely follows customer needs and industry technology development trends to conduct research and development, actively deploys cutting-edge products, and develops new products in a 2-3 year cycle. However, the technological development of the new energy electric drive system industry faces different routes, and the research and development of new technologies and new products face uncertainties such as high technical requirements, many involved links, long duration cycles, and fast iteration speeds. With a large amount of capital investment, the technical route changes and iterates, or some projects under development cannot be advanced as scheduled, R&D fails, and R&D results cannot be successfully industrialized, etc., which may cause the company's early R&D investment to be unable to be recovered in the future, reduce the company's core competitiveness, and have an adverse impact on the company's future development.

Countermeasures: In response to the above risks, the company has established a complete dynamic evaluation and iteration system for technical routes, and implemented full-process refined management and control of technology research and development projects. The company divides the research and development cycle into four stages: project establishment, prototype trial production, mold trial production and small batch production. At each stage, careful evaluation and testing is carried out around technical indicators, research and development progress, technical feasibility and market adaptability, and stage reports are formed to support research and development decisions. The Central Research Institute organizes expert review by sections, and dynamically adjusts the research and development layout based on industry technology trends and market changes to avoid inefficient technology investment and improve the efficiency of the use of research and development resources. At the same time, through graded management and control of R&D risks and dynamic allocation of funds, the company strictly controls capital investment in high-risk projects, reduces chain risks caused by technology iterations, effectively hedges R&D uncertainties, and ensures the stable and coordinated development of the company's innovative R&D and operations.

(5) Risks of high customer concentration

The company is mainly engaged in the research and development, production and sales of electric drive systems for new energy commercial vehicles. Due to the high market concentration in the downstream automotive industry, the company's customer concentration is also high. Against the background of increasingly intensified industry competition, if the company is unable to maintain its leading edge in products and technologies in the future, is unable to maintain cooperative relationships with major customers, or major adverse changes occur in the needs or operating conditions of major customers, it may have an adverse impact on the company's production, operations and profitability.

Countermeasures: The company will continue to strengthen product technology iteration and delivery guarantee capabilities, and consolidate in-depth cooperation with core customers. Closely track the operating dynamics of downstream markets and existing customers, improve the pre-sales, sales and after-sales full-process service system, improve service quality, enhance customer stickiness with technical strength and high-quality services, and maintain the stability of cooperation with existing customers. At the same time, the company will increase its market expansion efforts, actively develop high-quality potential customers, continue to optimize its customer structure, further reduce customer concentration, and hedge risks that may arise from operational fluctuations and changes in cooperation with core customers.

(6) Management risks

During the reporting period, the company's operating income, asset scale, number of employees, etc. all achieved rapid growth, and the requirements for the company's operation and management capabilities have also increased accordingly. If the company cannot promptly adapt to the higher requirements for operation management, internal control, financial management, etc. brought by the expansion of scale, it may cause the company to face management risks brought about by rapid development, which is not conducive to the company's long-term sustainable development.

Countermeasures: The company has adapted to the rapid expansion of scale through management system upgrades, information tool deployment and talent echelon construction. Continuously optimize the organizational structure and standardized processes, clarify authorization and approval levels to improve decision-making efficiency; simultaneously upgrade ERP and production execution and other systems to achieve real-time integration and visual control of core data such as finance, procurement, production, and sales. In terms of talent, the company continues to expand its personnel reserves, improve its talent echelon training system, focus on introducing experienced management and operation backbones, and establish an internal management trainee selection mechanism to cultivate reserve management forces from the new generation, ensuring the simultaneous improvement of management capabilities and revenue, assets, and personnel scale, and ensuring the company's long-term sustainable development.

(7) Intellectual property protection risks

As a high-tech enterprise, the company's intellectual property rights such as patents and software copyrights play an important role in the company's production and operations. If other companies infringe on the company's intellectual property rights and cause intellectual property disputes such as patents and software copyrights, the company will need to protect its own rights and interests through legal proceedings and other means, which may result in greater legal liability.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Legal and economic costs will have an adverse impact on the company's production and operations. At the same time, when the company is engaged in R&D and production business, there may be risks of infringement of third-party intellectual property rights. If the company is found to be infringing by judicial authorities in relevant intellectual property disputes in the future and bears corresponding liability for compensation, or the relevant claims are not supported by the intellectual property authorities, it may have an adverse impact on the company's operations and performance.

Countermeasures: The company will focus on building an intellectual property patent moat and establish an intellectual property management system for internal and external two-way prevention and control. Internally, we apply for patents and software copyright protection for core technologies in a timely manner, and conduct patent searches and analyzes before new projects are launched to avoid existing patent barriers and prevent unintentional infringement; we also carry out regular infringement monitoring, and promptly initiate administrative complaints or judicial rights protection once third-party counterfeiting or misappropriation is discovered. Externally, the ownership of intellectual property rights and the division of infringement liability are clarified in various cooperation agreements, clarifying the rights and obligations of all parties to the cooperation, reducing the cost of subsequent rights protection, and ensuring that the company takes the initiative in intellectual property disputes.

(8) Asset impairment risk

As the company's revenue scale grows, the company's accounts receivable and inventory amount also increase accordingly, and the occupation of the company's funds will also further increase, which may cause the company's liquidity to be tight. On the one hand, with the increase in accounts receivable, if the financial conditions of some customers deteriorate in the future, or there are major adverse changes in operating conditions or commercial credit, the possibility of bad debts in the company's accounts receivable will increase; on the other hand, the continued growth of inventory amounts may cause the company to lag in response to rises and falls in raw material prices, resulting in an increase in the risk of inventory depreciation, which will have an adverse impact on the company's operating results.

Countermeasures: In response to the risks related to the collection of accounts receivable and inventory depreciation, the company has strengthened credit management and inventory control respectively. In terms of accounts receivable management, we establish a dynamic assessment mechanism for customer credit, set differentiated credit limits and account terms based on customer payment records and financial conditions, collect overdue accounts in a timely manner, take legal measures when necessary, and incorporate the collection rate into sales performance assessments; at the same time, we use financial tools rationally to speed up the return of funds, reduce capital occupation, and ensure the controllable quality of accounts receivable. In terms of inventory management, we have established a rolling demand forecasting mechanism with major customers, implemented precise procurement and stocking based on order scheduling, and promoted lean production and pull-type replenishment to shorten inventory turnover days. We regularly conduct analysis of inventory age and net realizable value, promptly dispose of overdue and slow-moving inventory, and make full provision for inventory depreciation to achieve a reasonable match between inventory scale and operating income and prevent inventory depreciation risks.

11. Registration form for reception of research, communication, interviews and other activities during the reporting period

□Applicable Not applicable

During the reporting period, the company did not receive research, communication, interviews or other activities.

12. Formulation and implementation of market value management system and valuation improvement plan

Whether the company has formulated a market value management system.

□Yes No

Whether the company has disclosed plans to increase its valuation.

□Yes No

13. Implementation of the “Double Improvement of Quality and Return” action plan

Has the company disclosed an announcement on the action plan of “double improvement of quality and return”?

□Yes No

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Section 4 Corporate Governance, Environment and Society

1. Changes in directors and senior managers of the company

Applicable □Not applicable

Name Position held Type Date Reason

Lu Jianjun Vice Chairman Elected March 20, 2026 Job transfer

Huang Quanan Deputy General Manager Appointed March 20, 2026 Job transfer

2. Profit distribution and conversion of capital reserve funds into share capital during the reporting period

□Applicable Not applicable

The company plans not to distribute cash dividends, give away bonus shares, or convert public reserve funds into share capital in the first half of the year.

3. Implementation of the company’s equity incentive plan, employee stock ownership plan or other employee incentive measures

Applicable □Not applicable

1. Equity incentives

None

2. Implementation of employee stock ownership plan

Applicable □Not applicable

All effective employee stock ownership plans during the reporting period

Total number of stocks held as a percentage of listed company shares Scope of employees to be funded with funds to implement the plan Number of employees Changes

(shares) Proportion of total capital Source

Wujiang Qiantian Investment Management Co., Ltd.

4 44,189,700 No change 11.41% Employees’ own funds Company

Suzhou Green Control Enterprise Management Center

10 9,000,000 No change 2.32% Employees’ own funds (limited partnership)

Suzhou Green Control Investment Center (with

27 6,000,000 No change 1.55% Employees’ own capital limited partnership)

April 2026 Zhang Er

Suzhou Green Control No. 1 Investment Center

34 2,160,000, Mao Jiannan’s resignation 0.56% Employees’ own funds (limited partnership)

Exit

Suzhou Green Control No. 2 Investment Center

33 1,359,000 No change 0.36% Employees’ own funds (limited partnership)

Suzhou Green Control No. 3 Investment Center

31 925,020 No change 0.24% Employees’ own funds (limited partnership)

Shareholdings of directors and senior managers in employee stock ownership plans during the reporting period

Number of shares held at the beginning of the reporting period Number of shares held at the end of the reporting period Total share capital of listed companies Name Position

(share) (share) ratio

Li Lei Chairman, General Manager 33,362,094.90 33,458,094.90 8.64% Lu Jianjun Vice Chairman, Deputy General Manager 1,369,461.76 1,369,461.76 0.35% Wang Jinhuai Financial Director 300,000 300,000 0.08% Cao Jingyu Secretary to the Board of Directors/Assistant to the General Manager 637,500 637,500 0.16%

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Changes in asset management institutions during the reporting period

□Applicable Not applicable

Changes in equity caused by holders’ disposal of shares during the reporting period

□Applicable Not applicable

Exercise of shareholders’ rights during the reporting period: None

Other relevant situations and explanations of the employee stock ownership plan during the reporting period

□Applicable Not applicable

Changes in the membership of the Employee Stock Ownership Plan Management Committee

□Applicable Not applicable

The financial impact of employee stock ownership plans on listed companies during the reporting period and related accounting treatments

□Applicable Not applicable

Termination of employee stock ownership plans during the reporting period

□Applicable Not applicable

Other instructions: none

3. Other employee incentives

□Applicable Not applicable

4. Environmental information disclosure

Whether listed companies and their major subsidiaries are included in the list of companies that disclose environmental information in accordance with the law

□Yes No

5. Social Responsibility

(1) Environmental responsibility

While deeply cultivating its main business and continuously improving service quality, the company actively promotes green offices, practices the concept of resource conservation, and strictly implements energy-saving measures such as power saving and water saving. By introducing energy-saving technologies and deploying photovoltaic projects, the company continues to promote energy conservation and low-carbon development, and contributes to ecological environment protection and sustainable development. At the same time, the company strengthens the full-process compliance management of hazardous waste and regularly discloses information on the generation, storage, and disposal of hazardous waste on its official website to ensure standardized waste disposal. In the process of capacity expansion and technological transformation, the company continues to increase investment in supporting environmental protection facilities and actively helps achieve the "double carbon" goal.

(2) Employee responsibilities

The company adheres to the "people-oriented" management philosophy, strictly abides by the "Labor Law", "Labor Contract Law" and other laws and regulations, and effectively protects the legitimate rights and interests of employees. The company has established a dual-channel system for the promotion of technical experts and management in parallel, providing technical backbones with promotion space that does not rely on administrative ranks. At the same time, it has established a complete career development path and a full-coverage training system to comprehensively assist employees in improving their professional skills and personal career growth. The company provides employees with multiple benefits such as paid annual leave, holiday gifts, annual travel, wedding and childbirth gifts, and Spring Festival gifts for parents. It implements labor protection-related benefits such as high temperature allowance and night shift allowance, and organizes regular occupational health examinations to continue to create a safe and healthy workplace environment.

(3) Social responsibility

The company always keeps its corporate social responsibility in mind, and while deeply cultivating its main business, it keeps the society in mind and supports local development, actively participates in public welfare undertakings, and delivers warm power. The company continues to carry out funding projects for poor college students to help students study and grow; it regularly organizes employee volunteers to visit lonely elderly people and provide condolences and assistance; it actively participates in public welfare publicity on environmental protection science, vigorously advocates green and low-carbon concepts, and fulfills the industry's green development mission. During the reporting period, the company donated RMB 200,000 to the Suzhou Wujiang District Charity Federation to assist in the 2026 New Year charity fundraising work and gather positive social energy for good.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Section 5 Important Matters

1. Commitments made by the company’s actual controller, shareholders, related parties, acquirers, the company and other relevant parties that have been fulfilled during the reporting period and have been overdue as of the end of the reporting period □ Applicable  Not applicable

During the reporting period of the company, there were no commitments made by the company's actual controller, shareholders, related parties, acquirers, the company and other relevant parties that were fully fulfilled during the reporting period and that were overdue and unfulfilled as of the end of the reporting period.

2. Non-operating capital occupation of listed companies by controlling shareholders and other related parties □Applicable Not applicable

During the company's reporting period, there was no non-operational occupation of funds by the listed company's controlling shareholders and other related parties.

3. Illegal external guarantees

□Applicable Not applicable

The company had no illegal external guarantees during the reporting period.

4. Appointment and dismissal of accounting firms

Has the semi-annual financial report been audited?

□Yes No

The company's semi-annual report has not been audited.

5. Explanations of the Board of Directors and the Audit Committee on the accounting firm’s “non-standard audit report” for this reporting period □ Applicable  Not applicable

6. Explanation of the Board of Directors on the “Non-standard Audit Report” of the previous year □ Applicable  Not applicable

7. Matters related to bankruptcy and reorganization

□Applicable Not applicable

The company had no bankruptcy or reorganization related matters during the reporting period.

8. Litigation matters

Major litigation and arbitration matters

□Applicable Not applicable

The Company had no major litigation or arbitration matters during the reporting period.

Other litigation matters

Applicable □Not applicable

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Litigation (arbitration) Litigation (arbitration) basis Amount involved Whether a pre-litigation (arbitration) Litigation (arbitration) judgment execution status Disclosure date Disclosure index status (10,000 yuan) Litigation (arbitration) Progress Result and impact

These litigation matters will not have any impact on the financial condition of the company.

537.31 No Case not yet concluded Not applicable - Not applicable (arbitration) summary and going concern structure

cause significant adverse effects.

9. Punishment and Rectification

□Applicable Not applicable

There were no penalties or rectifications during the company's reporting period.

10. Integrity status of the company, its controlling shareholders and actual controllers

□Applicable Not applicable

11. Major related transactions

1. Related transactions related to daily operations

□Applicable Not applicable

The company had no related transactions related to daily operations during the reporting period.

2. Related transactions arising from asset or equity acquisition and sale

□Applicable Not applicable

The company had no related transactions related to asset or equity acquisition or sale during the reporting period.

3. Related transactions related to joint external investment

□Applicable Not applicable

The company had no related transactions related to joint external investments during the reporting period.

4. Related credit and debt transactions

□Applicable Not applicable

The company had no related creditor's rights or debts during the reporting period.

5. Dealings with related financial companies

□Applicable Not applicable

There are no deposits, loans, credit or other financial business between the company and its related financial companies, or between the company's financial companies and related parties.

6. The transactions between the financial company controlled by the company and related parties

□Applicable Not applicable

There are no deposits, loans, credit or other financial business between the financial companies controlled by the company and related parties.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

7. Other major related transactions

□Applicable Not applicable

The company had no other major related transactions during the reporting period.

12. Major contracts and their performance

1. Custody, contracting and leasing matters

(1) Custody situation

□Applicable Not applicable

There was no custody situation during the company's reporting period.

(2) Contracting situation

□Applicable Not applicable

There was no contracting situation during the reporting period of the company.

(3) Leasing situation

Applicable □Not applicable

Rental situation description

During the reporting period, the company's existing leases were required for normal production and operations. One is that the company leases some factories, office buildings, dormitories, etc., and the other is that the company's own houses are rented out. The company has signed lease agreements with both the lessor and the lessee, and they are currently being implemented normally.

Projects that bring profits and losses to the company exceeding 10% of the company's total profit during the reporting period

□Applicable Not applicable

During the company's reporting period, there were no leasing projects that brought profits or losses to the company that accounted for more than 10% of the company's total profits during the reporting period.

2. Major guarantee

Applicable □Not applicable

Unit: RMB 10,000 External guarantees provided by the company and its subsidiaries (excluding guarantees to subsidiaries)

Guarantee amount Counter guarantee

Is the collateral related to the guarantee? Amount of guarantee actually issued. Actual guarantee. Guarantee type situation. Whether it has been fulfilled.

(For example, the guarantee period, the name of the related party, the announcement disclosure, the date of birth, the insured amount type (if any after the completion of the transaction) Guarantee

Revealed date (yes)

External guarantees approved during the reporting period

Total external guarantee amount 0 Total actual amount incurred 0 (A1) (A2)

Approved at the end of the reporting period

External guarantees at the end of the reporting period

Total external guarantee amount 0 0

Total balance (A4)

(A3)

The company’s guarantees for subsidiaries

Guarantee object Guarantee amount Guarantee amount Actual occurrence Actual guarantee Guarantee type Collateral Counter guarantee Whether or not Guarantee period

Name Degree Relevance Degree Date Insured Amount Type (if the situation is related to performance)

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Announcement disclosed) (If the joint party is completed

Exposure date Yes) Guarantee for Wujiang Green Holdings 2025 August 2024

jointly and severally liable

Electronic Control Technology 1,000 August 26 1,000 None None 29th-2034 No Yes

Any guarantee

Ltd. Date August 29, year

Suzhou Green Control

2025 September 2023

New Energy Division jointly and severally liable

1,000 September 28 1,000 None None 28th-2026 No Yes Technology Co., Ltd. Guarantee

Date September 27, year

Division

Green control transmission

2025 September 2025

Technology (Southern Co., Ltd. and jointly responsible for

1,000 September 29 990 None None 25th-2035 No Yes Tong) Limited liability guarantee

Date September 25th

company

Green control transmission

2025 October 2025

Technology (Southern Co., Ltd. and jointly responsible for

10,000 October 31 1,996 None None 31st-2026 No Yes Tong) Limited Liability Guarantee

Date September 1, year

company

Green Control Transmission December 2025

2026

Science and Technology (Southern Co., Ltd. 26th-2028

12,000 January 5 5,410 None None No Yes Tong) Limited liability guarantee December 25

day

company day

Green control transmission

2026 January 2026

Technology (South 2,987.1 Jointly and severally liable

5,000 February 12 None None 25th-2027 No Yes Tong) Limited 8 Any guarantee

Date January 24th

company

The warranty of this contract

The certification period is from

Green Control Transmission This contract comes into effect

Science and Technology (Southern Co., Ltd. is jointly and jointly liable from the date of

80,000 Not yet incurred 0 None None No Yes (Yes) under the limited liability capital document

All debts of the company

Expiration of travel period

Three years from the date

Approval for subsidiaries during the reporting period

Total guarantee amount of the company 97,000 Total actual guarantee amount 8,397.18 (B1) Total (B2)

Approved transactions at the end of the reporting period

Total guarantee limit of subsidiaries 110,000 Total guarantee balance 13,383.18 (B3) (B4)

Guarantees provided by subsidiaries to subsidiaries

Guarantee amount Counter guarantee Whether

Collateral Whether the guarantee object is related to the degree of guarantee Amount of guarantee Actual occurrence The actual guarantee type is related to the situation (such as guarantee period Performance name Announcement disclosure date Insurance amount type (if there is a joint party) Completed

Revealed date Yes) Guarantee

Approval for subsidiaries during the reporting period

Total guarantee amount of the company: 0 Total actual guarantee amount: 0 (C1) Total (C2)

Approved transactions at the end of the reporting period

Total guarantee limit of subsidiaries 0 Total guarantee balance 0 (C3) (C4)

The total amount of company guarantees (i.e. the total of the first three major items)

The actual guarantee during the reporting period

Guarantee amount approved during the reporting period

97,000 Total amount incurred 8,397.18 Total degrees (A1+B1+C1)

(A2+B2+C2)

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Approved guarantees at the end of the reporting period Total guarantee limit at the end of the reporting period 110,000 Total balance 13,383.18 (A3+B3+C3) (A4+B4+C4) The balance of all guarantees (i.e. A4+B4+C4) accounts for the company’s net capital

12.91% production ratio

Among them:

Providing guarantees for shareholders, actual controllers and their related parties

Balance (D)

Directly or indirectly guaranteed for companies whose asset-liability ratio exceeds 70%

12,383.18 Debt guarantee balance provided by the object (E)

The amount of the total guarantee exceeding 50% of the net assets (F) 0 The total amount of the above three guarantees (D+E+F) 12,383.18 For unexpired guarantee contracts, guarantee liabilities occurred during the reporting period

Or there is evidence that there may be joint and several liability for repayment. Unconditional explanation (if any)

Explanation of providing external guarantees in violation of prescribed procedures (if any) Specific explanation of the absence of composite guarantees

None

3. Major contracts for daily operations

□Applicable Not applicable

4. Other major contracts

□Applicable Not applicable

The company had no other major contracts during the reporting period.

13. Description of other major matters

□Applicable Not applicable

There are no other significant matters that need to be explained during the company's reporting period.

14. Major events of the company’s subsidiaries

□Applicable Not applicable

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Section 6 Changes in Shares and Shareholders

1. Changes in shares

2. Changes in shares

Unit: Before this change in share capital Increase or decrease in this change (+, -) After this change

Quantity Proportion Issuance of new shares Bonus shares Conversion of provident funds Others Subtotal Quantity Proportion

1. Limited sales

387,267,000 100.00% 387,267,000 100.00% conditional shares

1. The state holds

shares

2. State-owned laws

491,886 0.13% 491,886.00 0.13% people hold shares

3. Others

386,775,114 99.87% 386,775,114 99.87% capital holdings

Among them:

Domestic legal persons hold 183,777,994 47.45% 183,777,994 47.45% shares

within the territory of

202,997,120 52.42% 202,997,120 52.42% shares held by natural persons

4. Foreign capital holdings

shares

Among them:

Overseas legal person holds

shares

from abroad

Random person holds shares

2. Unlimited sales

conditional shares

1. RMB

common stock

2. Domestic

foreign stocks in the city

3. Overseas

foreign stocks in the city

4. Others

3. Total shares

387,267,000 100.00% 387,267,000 100.00%

Reasons for share changes

□Applicable Not applicable

Approval status of share changes □Applicable Not applicable

Transfer status of share changes □Applicable Not applicable

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Implementation progress of share buybacks

□Applicable Not applicable

Implementation progress of using centralized bidding method to reduce and repurchase shares

□Applicable Not applicable

The impact of changes in shares on financial indicators such as basic earnings per share and diluted earnings per share in the most recent year and period, net assets per share attributable to the company's common shareholders □Applicable Not applicable

Other content that the company deems necessary or required to be disclosed by securities regulatory authorities

□Applicable Not applicable

2. Changes in restricted shares

□Applicable Not applicable

2. Securities issuance and listing

□Applicable Not applicable

3. Number of shareholders and shareholding status of the company

Unit: Share

Voting rights are restored at the end of the reporting period. Special voting rights are held.

Common shares at the end of the reporting period

55 total number of preference shareholders 0 shareholders of preferred shares 0 total number of shareholders

(If any) (See Note 8) Total number (if any)

Shareholding status of shareholders holding more than 5% of the shares or the top 10 shareholders (excluding shares lent through refinancing)

During the reporting period, holdings are restricted for sale, holdings are unlimited, pledged, marked or frozen shareholding ratio at the end of the reporting period

Name of shareholder, nature of shareholder, increase or decrease in conditions, condition of sale of shares, condition of sale

Example number of shares

Situation Quantity Number of shares Share status Quantity

Nature within the territory

Li Lei 32.23% 124,803,020 0 124,803,020 0 Not applicable 0

people

Wujiang Qiantian Investment Domestic Non-State

11.41% 44,189,700 0 44,189,700 0 Not applicable 0 Management Co., Ltd. Legal person

Nature within the territory

Huang Quanan 4.61% 17,841,900 0 17,841,900 0 Not applicable 0

people

Tianjin Zhiyi Shengfu

Investment partnership Others 3.10% 12,000,000 0 12,000,000 0 Not applicable 0 (limited partnership)

Jiangsu CMB Modern

Industrial equity investment

Others 2.67% 10,347,510 0 10,347,510 0 Not applicable 0 Fund Phase I (with

limited partnership)

Tianjin Zhiyi Shengze

Corporate Management Partnership Domestic and Non-State

2.58% 9,990,000 0 9,990,000 0 Not applicable 0 Enterprise (limited legal person)

Guy)

Nature within the territory

Wei Junmin 2.50% 9,673,700 0 9,673,700 0 Not applicable 0 people

Nature within the territory

Song Peng 2.50% 9,673,700 0 9,673,700 0 Not applicable 0

people

Suzhou Green Control Enterprise Domestic Non-State

2.32% 9,000,000 0 9,000,000 0 Not applicable 0 Management Center (Yes There is a legal person

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

limited partnership)

Nature within the territory

He Guowang 2.27% 8,775,500 0 8,775,500 0 Not applicable 0

people

Strategic investors or general legal persons due to allocation

Selling new shares to become the top 10 shareholders Not applicable

Circumstances (if any) (see Note 3)

1. Wujiang Qiantian Investment Management Co., Ltd. is an enterprise controlled by Li Lei, the company’s controlling shareholder and actual controller, and constitutes a shareholder-related relationship or person acting in concert with the above-mentioned shareholders;

Description of the activity 2. Suzhou Green Control Enterprise Management Center (Limited Partnership) is the company’s employee shareholding platform;

3. Natural person shareholder He Guowang is the brother-in-law of Li Lei, the company’s controlling shareholder and actual controller. The above-mentioned shareholders are involved in the entrustment/trustee table

voting rights and renunciation of voting rights Not applicable

Ming

Among the top 10 shareholders, there are buyback specialties

Special Instructions for Users (See Note N/A

11)

Shareholding status of the top 10 shareholders without sales restrictions (excluding shares lent through refinancing and executive locked shares) Share type Name of shareholder Number of shares without sales restrictions held at the end of the reporting period

Type of shares Among the top 10 shareholders without selling restrictions

room, and unlimited sales for the first 10

At the end of the reporting period, the company was not listed and had no unrestricted tradable shares.

between shareholders and the top 10 shareholders

Description of related relationships or concerted actions

The top 10 common shareholders participated in the financing

Description of shareholders of financing and securities financing business Not applicable

(if any) (see note 4)

Situation of shareholders holding more than 5% of the shares, the top 10 shareholders and the top 10 shareholders of unrestricted tradable shares participating in the refinancing business and lending shares □Applicable Not applicable

The top 10 shareholders and the top 10 shareholders of unrestricted tradable shares have changed from the previous period due to refinancing lending/returning □Applicable Not applicable

Whether the company has differential voting rights arrangements

□Yes No

Whether the company's top 10 common shareholders and the top 10 common shareholders without selling restrictions have conducted agreed repurchase transactions during the reporting period Yes  No

The company's top 10 common shareholders and the top 10 common shareholders without selling restrictions did not conduct agreed repurchase transactions during the reporting period.

4. Changes in shareholdings of directors and senior managers

□Applicable Not applicable

The shareholdings of the company's directors and senior managers did not change during the reporting period. For details, please refer to the prospectus.

5. Changes in controlling shareholders or actual controllers

If the company has previously disclosed that the actual controller is planning a change of control but has not yet completed it, please explain the progress of the change of control. □Applicable Not applicable

Changes in controlling shareholders during the reporting period

□Applicable Not applicable

The company's controlling shareholder did not change during the reporting period.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 Semi-annual Report Actual controller changes during the reporting period □ Applicable  Not applicable

The actual controller of the company did not change during the reporting period.

6. Relevant information on preference shares □Applicable Not applicable

There were no preferred shares in the company during the reporting period.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Section 7 Bond-related situations □Applicable Not applicable

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Section 8 Financial Report

1. Audit report

Has the semi-annual report been audited?

□Yes No

The company's semi-annual financial report has not been audited.

2. Financial statements

The unit of statements in the financial notes is: Yuan

1. Consolidated balance sheet

Prepared by: Suzhou Green Control Transmission Technology Co., Ltd.

June 30, 2026

Unit: Yuan

Item Ending balance Beginning balance

Current assets:

Monetary funds 600,823,941.59 275,784,245.96 Settlement reserves

Loan funds

trading financial assets

Derivative financial assets

Notes receivable 799,698,067.01 569,579,604.98 Accounts receivable 1,700,398,182.57 1,484,468,771.97 Accounts receivable financing 55,160,805.74 61,467,445.23 Advance payments 22,406,036.56 14,410,673.50 Premiums receivable

Reinsurance accounts receivable

Receivable reinsurance contract reserves

Other receivables 6,406,788.40 5,376,125.97 Including: interest receivable

Dividends receivable

Buy financial assets under resale agreements

Inventory 1,046,735,041.92 800,337,167.66

Among them: data resources

Contract assets 18,247,821.28 15,920,795.35 Assets held for sale

Non-current assets due within one year 12,392,502.23 14,173,749.59 Other current assets 68,882,454.54 48,962,262.05 Total current assets 4,331,151,641.84 3,290,480,842.26 Non-current assets:

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Grant loans and advances

debt investment

Other debt investments

Long-term receivables 1,963,911.63 2,064,329.70 Long-term equity investment

Other equity instrument investments 36,551,764.14 36,000,000.00 Other non-current financial assets

Investment real estate 53,137,410.93 54,895,288.83 Fixed assets 806,838,096.18 605,507,584.60 Construction in progress 203,404,490.65 172,254,255.59 Productive biological assets

oil and gas assets

Right-of-use assets 6,459,056.83 8,304,501.67 Intangible assets 99,562,003.76 97,494,831.71

Among them: data resources

development expenditure

Among them: data resources

goodwill

Long-term deferred expenses 36,136,634.79 32,111,979.04 Deferred income tax assets 136,764,834.33 138,844,893.98 Other non-current assets 133,713,714.58 51,845,379.63 Total non-current assets 1,514,531,917.82 1,199,323,044.75 Total assets 5,845,683,559.66 4,489,803,887.01 Current liabilities:

Short-term borrowings 1,411,549,575.31 789,866,323.73 Borrowings from the central bank

borrowing funds

Trading financial liabilities

Derivative financial liabilities

Notes payable 429,774,053.75 144,036,515.72 Accounts payable 1,648,141,769.58 1,488,768,052.92 Advance payments

Contract liabilities 11,451,156.82 8,386,403.90 Financial assets sold and repurchased

Taking deposits and placing deposits with other banks

Agent for buying and selling securities

Agent underwriting securities funds

Employee benefits payable 77,282,049.38 72,525,188.87 Taxes payable 7,715,492.59 23,067,489.64 Other payables 79,039,941.58 72,674,092.70 Including: interest payable

Dividends payable

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Handling fees and commissions payable

Reinsurance accounts payable

Liabilities held for sale

Non-current liabilities due within one year 85,310,292.94 136,602,251.41 Other current liabilities 591,592,751.26 501,247,930.98 Total current liabilities 4,341,857,083.21 3,237,174,249.87 Non-current liabilities:

insurance contract reserves

Long-term borrowings 124,735,310.34 49,605,265.98 Bonds payable

Among them: preferred shares

perpetual bond

Lease liabilities 1,970,960.68 3,907,071.36 Long-term payables

Long-term employee benefits payable

Estimated liabilities 193,576,919.68 143,903,597.03 Deferred income 145,317,408.81 144,962,235.65 Deferred income tax liabilities 1,940,669.89 2,245,787.29 Other non-current liabilities

Total non-current liabilities 467,541,269.40 344,623,957.31 Total liabilities 4,809,398,352.61 3,581,798,207.18 Owners’ equity:

Share capital 387,267,000.00 387,267,000.00 Other equity instruments

Among them: preferred shares

perpetual bond

Capital reserve 632,267,992.36 627,620,758.27 Less: treasury shares

Other comprehensive income -16,244.50

Special reserves 11,656,191.74 11,366,336.89 Surplus reserve

General risk preparation

Undistributed profits 5,110,267.45 -118,248,415.33 Total owners’ equity attributable to the parent company 1,036,285,207.05 908,005,679.83 Minority shareholders’ equity

Total owners’ equity 1,036,285,207.05 908,005,679.83 Total liabilities and owners’ equity 5,845,683,559.66 4,489,803,887.01 Legal representative: Li Lei Person in charge of accounting work: Wang Jinhuai Person in charge of accounting department: Ding Bangqin

2. Balance sheet of the parent company

Unit: Yuan

Item Ending balance Beginning balance

Current assets:

Monetary funds 479,899,775.99 231,915,626.82 Trading financial assets

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Derivative financial assets

Notes receivable 795,636,504.76 561,480,016.55 Accounts receivable 1,823,902,917.89 1,567,260,101.99 Accounts receivable financing 55,146,805.74 61,387,835.69 Advance payments 15,435,173.48 6,818,260.53 Other receivables 9,502,916.49 9,153,758.48 Including: interest receivable

Dividends receivable

Inventory 707,702,722.34 531,314,806.60

Among them: data resources

Contract assets 18,054,591.28 15,727,565.35 Assets held for sale

Non-current assets due within one year 10,889,572.24 11,828,145.24 Other current assets 50,944,645.64 31,467,638.33 Total current assets 3,967,115,625.85 3,028,353,755.58 Non-current assets:

debt investment

Other debt investments

Long-term receivables 1,963,911.63 2,062,909.51 Long-term equity investment 328,293,532.27 328,273,532.27 Other equity instrument investments 35,551,764.14 35,000,000.00 Other non-current financial assets

Investment real estate 9,449,955.63 9,796,428.27 Fixed assets 558,523,512.40 371,615,866.15 Construction in progress 76,474,410.07 141,509,949.57 Productive biological assets

oil and gas assets

right-of-use assets

Intangible assets 55,677,772.62 53,100,522.17

Among them: data resources

development expenditure

Among them: data resources

goodwill

Long-term deferred expenses 19,777,225.28 17,121,887.70 Deferred income tax assets 117,492,747.33 127,175,815.43 Other non-current assets 72,001,455.57 40,025,519.39 Total non-current assets 1,275,206,286.94 1,125,682,430.46 Total assets 5,242,321,912.79 4,154,036,186.04 Current liabilities:

Short-term borrowings 932,157,376.01 527,346,883.71 Trading financial liabilities

Derivative financial liabilities

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Notes payable 547,102,440.30 174,973,796.41 Accounts payable 1,795,221,817.59 1,620,625,945.58 Advance payments

Contract liabilities 9,618,482.44 6,301,785.82 Employee benefits payable 46,613,789.26 42,547,464.02 Taxes payable 2,654,892.53 1,979,965.94 Other payables 79,000,125.77 101,215,452.18 of which: interest payable

Dividends payable

Liabilities held for sale

Non-current liabilities due within one year 81,559,695.77 133,005,361.67 Other current liabilities 483,783,247.40 482,755,379.41 Total current liabilities 3,977,711,867.07 3,090,752,034.74 Non-current liabilities:

Long-term borrowings 124,735,310.34 49,605,265.98 Bonds payable

Among them: preferred shares

perpetual bond

Lease liability

long-term payables

Long-term employee benefits payable

Estimated liabilities 193,576,919.68 143,903,597.03 Deferred income 87,520,732.17 115,489,980.13 Deferred income tax liabilities

Other non-current liabilities

Total non-current liabilities 405,832,962.19 308,998,843.14 Total liabilities 4,383,544,829.26 3,399,750,877.88 Owners’ equity:

Share capital 387,267,000.00 387,267,000.00 Other equity instruments

Among them: preferred shares

perpetual bond

Capital reserve 638,764,338.57 634,117,104.48 minus: treasury shares

other comprehensive income

Special reserves 11,656,191.74 11,366,336.89 Surplus reserve

Undistributed profits -178,910,446.78 -278,465,133.21 Total owners’ equity 858,777,083.53 754,285,308.16 Total liabilities and owners’ equity 5,242,321,912.79 4,154,036,186.04

3. Consolidated income statement

Unit: Yuan

Project Half-year 2026 Half-year 2025

1. Total operating income 2,365,788,093.57 1,219,063,220.00

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Including: operating income 2,365,788,093.57 1,219,063,220.00 interest income

Premiums earned

Fee and commission income

2. Total operating costs 2,223,041,762.68 1,122,770,400.60 Including: operating costs 2,024,947,676.34 982,803,642.58 Interest expenses

Handling fees and commission expenses

surrender deposit

Net compensation expenses

Net withdrawal of insurance liability reserves

policy dividend payout

Reinsurance cost

Taxes and surcharges 6,198,313.08 4,126,593.04 Sales expenses 47,423,779.34 37,961,890.40 Management expenses 41,752,189.89 37,808,341.91 Research and development expenses 85,146,778.40 50,418,186.14 Financial expenses 17,573,025.63 9,651,746.53 Including: interest expenses 16,301,128.41 9,545,744.10

Interest income 164,193.89 266,560.48 plus: other income 25,518,804.75 19,485,785.56 investment income (losses are filled in with "-"

-3,199,814.65 -2,143,801.35 columns)

Of which: for associates and joint ventures

corporate investment income

Measured at amortized cost

Income from derecognition of financial assets

Exchange gains (losses are filled in with "-"

column)

Net exposure hedging gains (losses expressed as “—

"Fill in the column)

Gains from changes in fair value (losses calculated as

6,263,860.48 (please fill in the “—” number)

Credit impairment losses (losses are preceded by “—”

-19,234,033.44 -31,148,586.23 (Fill in the numbers)

Asset impairment losses (losses are represented by “—”

-13,294,507.27 -14,415,826.56 (fill in the numbers)

Gains from asset disposals (losses are marked with “—”

No. 198,536.02 -109,283.96 (please fill in the list)

3. Operating profit (loss should be filled in with “—”

132,735,316.30 74,224,967.34 columns)

Add: Non-operating income 76,193.59 64,174.76 Less: Non-operating expenses 1,082,848.48 1,139,596.27

4. Total profit (total loss is marked with “—”

131,728,661.41 73,149,545.83 fill in the column)

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Less: Income tax expenses 8,369,978.63 4,854,082.48

5. Net profit (net loss is filled in with "-"

123,358,682.78 68,295,463.35 columns)

(1) Classification by business continuity

1. Net profit from continuing operations (net loss divided by

123,358,682.78 68,295,463.35 (Fill in “—”)

2. Net profit from discontinued operations (net loss equal to

Fill in the column with "—" sign)

(2) Classification according to ownership ownership

1. Net profit attributable to shareholders of the parent company

123,358,682.78 68,295,463.35 (Net loss is listed with "—")

2. Profit and loss of minority shareholders (net loss is represented by “—

"Fill in the column)

6. Net after-tax other comprehensive income -16,244.50 Other comprehensive income attributable to owners of the parent company

-16,244.50 net after tax

(1) Others that cannot be reclassified into profit or loss

Comprehensive income

1. Remeasure changes in defined benefit plans

Um

2. Others that cannot be transferred to profit or loss under the equity method

Comprehensive income

3. Fair value of other equity instrument investments

change

4. Fair value of the company’s own credit risk

change

5.Others

(2) Other comprehensive items that will be reclassified into profit or loss

-16,244.50 combined income

1. Other comprehensive items that can be transferred to profits and losses under the equity method

combined income

2. Changes in fair value of other debt investments

3. Financial assets are reclassified into other comprehensive

Amount of combined income

4. Credit impairment provisions for other debt investments

5. Cash flow hedging reserve

6. Translation difference of foreign currency financial statements -16,244.50 7. Others

Other comprehensive income attributable to minority shareholders

net of tax

7. Total comprehensive income 123,342,438.28 68,295,463.35 Total comprehensive income attributable to owners of the parent company

123,342,438.28 68,295,463.35 amount

Total comprehensive income attributable to minority shareholders

8. Earnings per share:

(1) Basic earnings per share 0.32 0.18

(2) Diluted earnings per share 0.32 0.18

Legal representative: Li Lei Person in charge of accounting work: Wang Jinhuai Person in charge of accounting department: Ding Bangqin

4. Income statement of the parent company

Unit: Yuan

Project Half-year 2026 Half-year 2025

1. Operating income 2,319,204,524.06 1,189,760,599.01

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Less: Operating costs 2,067,112,950.66 1,071,543,173.56 Taxes and surcharges 3,411,602.56 1,880,194.06 Sales expenses 43,987,568.96 34,895,913.87 Administrative expenses 32,906,306.74 28,776,626.26 Research and development expenses 56,328,270.47 36,951,145.39 Financial expenses 12,193,810.71 7,122,154.87 Including: interest expenses 11,792,421.65 6,968,626.29

Interest income 148,714.41 174,051.79 plus: other income 40,475,512.22 8,191,474.75 investment income (losses are filled in with "-"

-3,202,129.44 -2,209,823.57 columns)

Of which: for associates and joint ventures

investment income

Money measured at amortized cost

Income from derecognition of financial assets

Net exposure hedging gains (losses expressed as “—

"Fill in the column)

Gains from changes in fair value (losses calculated as

6,263,860.48 (please fill in the “—” number)

Credit impairment losses (losses are preceded by “—”

-19,215,650.72 -31,149,344.07 (Fill in the numbers)

Asset impairment losses (losses are represented by “—”

-11,521,936.30 -10,192,434.03 (Fill in the numbers)

Gains from asset disposals (losses are marked with “—”

-3,188.26 21,594.76 (please fill in the list)

2. Operating profit (loss should be filled in with “—”

109,796,621.46 -20,483,280.68 columns)

Add: Non-operating income 117,133.42 63,628.28 Less: Non-operating expenses 676,000.35 912,729.58

3. Total profit (total loss is marked with “—”

109,237,754.53 -21,332,381.98 fill in the column)

Less: Income tax expenses 9,683,068.10 -7,226,704.69

4. Net profit (net loss is filled in with "—"

99,554,686.43 -14,105,677.29 columns)

(1) Net profit from continuing operations (net loss divided by

Fill in the column with "—" sign)

(2) Net profit from discontinued operations (net loss equal to

Fill in the column with "—" sign)

5. Net amount of other comprehensive income after tax

(1) Others that cannot be reclassified into profit or loss

Comprehensive income

1. Remeasure changes in defined benefit plans

Um

2. Others that cannot be transferred to profit or loss under the equity method

Comprehensive income

3. Fair value of other equity instrument investments

change

4. Fair value of the company’s own credit risk

change

5.Others

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

(2) Other comprehensive items that will be reclassified into profit or loss

combined income

1. Other comprehensive items that can be transferred to profits and losses under the equity method

combined income

2. Changes in fair value of other debt investments

3. Financial assets are reclassified into other comprehensive

Amount of combined income

4. Credit impairment provisions for other debt investments

5. Cash flow hedging reserve

6. Translation differences of foreign currency financial statements

7.Others

6. Total comprehensive income 99,554,686.43 -14,105,677.29

7. Earnings per share:

(1) Basic earnings per share

(2) Diluted earnings per share

5. Consolidated cash flow statement

Unit: Yuan

Project Half-year 2026 Half-year 2025

1. Cash flow generated from operating activities:

Cash received from selling goods and providing services 1,127,173,251.74 574,269,007.03 Net increase in customer deposits and deposits from banks

Net increase in borrowing from the central bank

Net increase in borrowing funds from other financial institutions

Cash received from premiums from the original insurance contract

Net cash received from reinsurance business

Net increase in policyholders’ savings and investment funds

Cash collected from interest, fees and commissions

Net increase in borrowing funds

Net increase in repurchase business funds

Net cash received from buying and selling securities on behalf of agents

Tax refunds received 1,377,744.33 3,363,607.63 Other cash received related to operating activities 21,615,066.20 9,065,017.63 Subtotal of cash inflows from operating activities 1,150,166,062.27 586,697,632.29 Cash paid for purchasing goods and receiving services 731,750,443.88 440,555,246.13

Net increase in loans and advances to customers

Net increase in deposits with central banks and inter-banks

Cash used to pay compensation from the original insurance contract

Net increase in lending funds

Cash payments for interest, fees and commissions

Cash payment for policy dividends

Cash paid to and for employees 232,429,262.42 134,690,293.47 Various taxes paid 35,602,490.80 17,848,234.34 Cash paid other related to operating activities 65,499,618.03 55,250,714.78 Subtotal cash outflow from operating activities 1,065,281,815.13 648,344,488.72 Net cash flow generated from operating activities 84,884,247.14 -61,646,856.43

2. Cash flow generated from investing activities:

Cash received from recovery of investment 110,000,000.00 176,700,000.00 Cash received from investment income 311,889.85 194,557.77 Disposal of fixed assets, intangible assets and other long-term assets

313,409.21 5,503,466.07 Net cash amount from asset recovery

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Received from disposal of subsidiaries and other business units

net cash

Other cash received related to investing activities

Subtotal of cash inflows from investing activities 110,625,299.06 182,398,023.84 Purchase and construction of fixed assets, intangible assets and other long-term assets

285,604,044.02 137,442,198.27 Cash paid for assets

Cash paid for investment 110,000,000.00 198,700,000.00 Net increase in pledged loans

Obtain payment from subsidiaries and other business units

net cash

Other cash payments related to investing activities

Subtotal of cash outflows from investing activities 395,604,044.02 336,142,198.27 Net cash flow generated from investing activities -284,978,744.96 -153,744,174.43

3. Cash flow generated from financing activities:

Cash received from investment 245,227,500.00, including: income received from investment by subsidiaries from minority shareholders

Cash arrived

Cash received from borrowings 917,971,091.24 606,454,150.00 Cash received from other financing activities

Subtotal of cash inflows from financing activities 917,971,091.24 851,681,650.00 Cash paid to repay debts 368,130,000.00 444,920,000.00

Distribution of dividends, profits or repayment of interest payments

15,860,543.86 9,540,715.79 cash

Including: shares paid by subsidiaries to minority shareholders

Profit, profit

Cash payments related to other financing activities 5,212,167.42 2,071,404.61 Subtotal of cash outflows from financing activities 389,202,711.28 456,532,120.40 Net cash flow generated from financing activities 528,768,379.96 395,149,529.60

4. The impact of exchange rate changes on cash and cash equivalents

-684,220.01

influence

5. Net increase in cash and cash equivalents 327,989,662.13 179,758,498.74 Plus: opening balance of cash and cash equivalents 262,251,714.40 109,077,744.17

6. Balance of cash and cash equivalents at the end of the period 590,241,376.53 288,836,242.91

7. Cash flow statement of the parent company

Unit: Yuan

Project Half-year 2026 Half-year 2025

1. Cash flow generated from operating activities:

Cash received from selling goods and providing services 1,215,879,508.16 545,973,745.15 Tax refunds received 247,791.24

Other cash received related to operating activities 4,850,205.84 13,862,783.28 Subtotal of cash inflows from operating activities 1,220,977,505.24 559,836,528.43 Cash paid for purchasing goods and receiving services 951,801,733.90 455,098,588.60 Cash paid to and for employees 112,258,672.54 73,527,035.78 Various taxes paid 3,138,431.08 2,443,178.22 Cash paid for other operating activities 79,804,013.09 50,588,964.62 Subtotal cash outflow from operating activities 1,147,002,850.61 581,657,767.22 Net cash flow generated from operating activities 73,974,654.63 -21,821,238.79

2. Cash flow generated from investing activities:

Cash received from recovery of investment 105,000,000.00 146,700,000.00 Cash received from investment income 309,575.06 124,529.99 Disposal of fixed assets, intangible assets and other long-term assets

Net cash amount recovered from assets in period 10,552,881.82

Received from disposal of subsidiaries and other business units

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

net cash

Other cash received related to investing activities

Subtotal of cash inflows from investing activities 105,309,575.06 157,377,411.81 Purchase and construction of fixed assets, intangible assets and other long-term assets

205,968,417.20 Cash paid for assets in 101,785,751.05 period

Cash paid for investment 105,020,000.00 243,550,000.00

Obtain payment from subsidiaries and other business units

net cash

Cash payments related to other investment activities 199,035.73

Subtotal of cash outflows from investing activities 311,187,452.93 345,335,751.05 Net cash flow generated from investing activities -205,877,877.87 -187,958,339.24

3. Cash flow generated from financing activities:

Cash received from investments 245,227,500.00 Cash received from borrowings 611,039,274.82 438,464,150.00

Other cash received related to financing activities

Subtotal of cash inflows from financing activities 611,039,274.82 683,691,650.00 Cash paid to repay debts 213,140,000.00 316,000,000.00 Paid to distribute dividends, profits or pay interest

11,585,076.27 6,935,812.41 cash

Cash payments related to other financing activities 3,311,796.22

Subtotal of cash outflows from financing activities 228,036,872.49 322,935,812.41 Net cash flow generated from financing activities 383,002,402.33 360,755,837.59

4. The impact of exchange rate changes on cash and cash equivalents

-165,063.22

influence

5. Net increase in cash and cash equivalents 250,934,115.87 150,976,259.56

Add: Balance of cash and cash equivalents at the beginning of the period 218,383,875.58 77,125,678.08

6. Balance of cash and cash equivalents at the end of the period 469,317,991.45 228,101,937.64

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

7. Consolidated statement of changes in owners’ equity

Amount of current period

Unit: yuan for the first half of 2026

Owner's equity attributable to parent company

Item Other equity instruments Profit reduction: General

You Yong Other Comprehensive Remaining Other Shareholders Total Owner's Equity Equity Continued Other Capital Reserves Inventory Income Special Reserves Corporate Risks Undistributed Profit Other Subtotal Equity Other Shares Reserve

stock debt accumulation

-

1. Ending balance of the previous year 387,267,000.00 627,620,758.27 11,366,336.89 908,005,679.83 908,005,679.83 118,248,415.33

Add: Accounting policy changes

Update

Early error update

Right

Others

-

2. Balance at the beginning of the year 387,267,000.00 627,620,758.27 11,366,336.89 908,005,679.83 908,005,679.83

118,248,415.33

3. Increase or decrease of change funds in this period

-

Amount (decreased with a “-” sign 4,647,234.09 289,854.85 123,358,682.78 128,279,527.22 128,279,527.22

16,244.50

Fill in the column)

-

(1) Total comprehensive income 123,358,682.78 123,342,438.28 123,342,438.28

16,244.50

(2) Owner’s investment and

4,647,234.09 4,647,234.09 4,647,234.09 Capital reduction

1． Owner's investment

shares

2. Other equity instruments held

investors invest capital

3. Share-based payments are included in all

4,647,234.09 4,647,234.09 4,647,234.09 Amount of shareholders’ equity

4. Others

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

(3) Profit distribution

1． Withdrawal from surplus reserve

2. Withdraw general risk reserve

3. to the owner (or stock

East) distribution

4. Others

(4) Within owner’s equity

carried forward

1． Capital reserve converted into capital

(or equity)

2. Conversion of surplus reserves into capital

(or equity)

3. Surplus reserve to cover losses

4. Changes to defined benefit plans

Amount carried forward to retained earnings

5. Other comprehensive income carried forward

retained earnings

6. Others

(5) Special reserves 289,854.85 289,854.85 289,854.85 1. Withdrawal in this period 2,981,840.94 2,981,840.94 2,981,840.94 2. Use in this period 2,691,986.09 2,691,986.09 2,691,986.09

(6) Others

-

4. Ending balance of the current period 387,267,000.00 632,267,992.36 11,656,191.74 5,110,267.45 1,036,285,207.05 1,036,285,207.05

16,244.50

Amount of previous year

Unit: yuan for the first half of 2025

Owner's equity attributable to parent company

Minority Items Other Equity Instruments Less: Other Profit General Its Shareholders Total Owner’s Equity Equity Excellent Yong Its Capital Reserve Inventory Comprehensive Special Reserves Risk Undistributed Profit Others Subtotal Equity

Continue to prepare for his stock income announcement

Suzhou Lvkong Transmission Technology Co., Ltd. 2026 Semi-annual Report Full Text Shares Debt Accumulation

-

1. Ending balance of the previous year 60,652,000.00 699,566,379.36 9,227,278.30 498,035,511.17 498,035,511.17 271,410,146.49

Add: Changes in accounting policies

Early error correction

Others

-

2. Balance at the beginning of the year 60,652,000.00 699,566,379.36 9,227,278.30 498,035,511.17 498,035,511.17

271,410,146.49

3. Amount of increase or decrease in the current period

326,615,000.00 -77,031,310.77 986,869.15 68,295,463.35 318,866,021.73 318,866,021.73 (reduced numbers are filled in with "-")

(1) Total comprehensive income 68,295,463.35 68,295,463.35 68,295,463.35

(2) Owner’s investment and reduction

326,615,000.00 226,228,689.23 552,843,689.23 552,843,689.23 Capital

1． Ordinary shares invested by owners 326,615,000.00 221,872,500.00 548,487,500.00 548,487,500.00 2. Other equity instrument holders

Invest capital

3. Share-based payments are credited to owners

4,356,189.23 4,356,189.23 4,356,189.23Amount of equity

4. Others

(3) Profit distribution

1． Withdrawal from surplus reserve

2. Withdraw general risk reserve

3. To the owner (or shareholder)

distribution

4. Others

(4) Internal balance of owners’ equity - - - Transfer 303,260,000.00 303,260,000.00 303,260,000.00 1. Capital reserve converted into capital - - - (or share capital) 303,260,000.00 303,260,000.00 303,260,000.00 2. Conversion of surplus reserves into capital

(or equity)

3. Surplus reserve to cover losses

Full text of the 2026 semi-annual report of Suzhou Green Control Transmission Technology Co., Ltd. 4. Change amount of defined benefit plan

Carry forward retained earnings

5. Other comprehensive income carried forward

savings income

6. Others

(5) Special reserves 986,869.15 986,869.15 986,869.15 1. Withdrawal in this period 1,939,719.02 1,939,719.02 1,939,719.02 2. Used in this period 952,849.87 952,849.87 952,849.87

(6) Others

-

4. Ending balance of the current period 387,267,000.00 622,535,068.59 10,214,147.45 816,901,532.90 816,901,532.90

203,114,683.14

8. Statement of changes in owner’s equity of the parent company

Amount of current period

Unit: yuan for the first half of 2026

Other equity instruments

Item Less: Inventory Other comprehensive income Surplus company Other

Equity Priority Perpetual Other Capital Reserves Special Reserves Undistributed Profits Total Owners’ Equity Equity Reserves Others

stocks debt him

-

1. Ending balance of the previous year 387,267,000.00 634,117,104.48 11,366,336.89 754,285,308.16 278,465,133.21

Add: Changes in accounting policies

Early error correction

Others

-

2. Balance at the beginning of the year 387,267,000.00 634,117,104.48 11,366,336.89 754,285,308.16

278,465,133.21

3. Amount of increase or decrease in the current period (decreases are marked with "-"

4,647,234.09 289,854.85 99,554,686.43 104,491,775.37 fill in the column)

(1) Total comprehensive income 99,554,686.43 99,554,686.43

(2) Owner’s investment and capital reduction 4,647,234.09 4,647,234.09

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report 1. Common stock invested by owners

2. Capital invested by other equity instrument holders

3. The amount of share-based payment included in owners’ equity 4,647,234.09 4,647,234.09 4. Others

(3) Profit distribution

1． Withdrawal from surplus reserve

2. Distributions to owners (or shareholders)

3. Others

(4) Internal carryover of owners’ equity

1． Conversion of capital reserves to capital (or share capital)

2. Conversion of surplus reserves into capital (or share capital)

3. Surplus reserve to cover losses

4. Changes in defined benefit plans are carried forward to retained earnings

5. Other comprehensive income carried forward to retained earnings

6. Others

(5) Special reserves 289,854.85 289,854.85 1. Withdrawal in this period 2,981,840.94 2,981,840.94 2. Used in this period 2,691,986.09 2,691,986.09

(6) Others

-

4. Closing balance of the current period 387,267,000.00 638,764,338.57 11,656,191.74 858,777,083.53

178,910,446.78 Amount of last period

Unit: yuan for the first half of 2025

Other equity instruments

Items Less: Inventory Other comprehensive income Surplus company Its share capital Priority Perpetual Its capital reserve Special reserve Undistributed profits Total owner’s equity Equity Accumulation Other shares Debt Others

-

1. Ending balance of the previous year 60,652,000.00 706,062,725.57 9,227,278.30 514,730,852.42 261,211,151.45

Add: Changes in accounting policies

Correction of early errors in the full text of the 2026 semi-annual report of Suzhou Green Control Transmission Technology Co., Ltd.

Others

-

2. Balance at the beginning of the year 60,652,000.00 706,062,725.57 9,227,278.30 514,730,852.42

261,211,151.45

3. Amount of increase or decrease in the current period (decreases are marked with "-"

326,615,000.00 -77,031,310.77 986,869.15 -14,105,677.29 236,464,881.09Fill in the column)

(1) Total comprehensive income -14,105,677.29 -14,105,677.29

(2) Owner’s investment and capital reduction 326,615,000.00 226,228,689.23 552,843,689.23 1. Ordinary shares invested by owners 326,615,000.00 221,872,500.00 548,487,500.00 2. Capital invested by other equity instrument holders

3. The amount of share-based payment included in owners’ equity 4,356,189.23 4,356,189.23 4. Others

(3) Profit distribution

1． Withdrawal from surplus reserve

2. Distributions to owners (or shareholders)

3. Others

(4) Internal carryover of owners’ equity

303,260,000.00 303,260,000.00

• • 1. Conversion of capital reserves to capital (or share capital)

303,260,000.00 303,260,000.00 2. Conversion of surplus reserves into capital (or share capital)

3. Surplus reserve to cover losses

4. Changes in defined benefit plans are carried forward to retained earnings

5. Other comprehensive income carried forward to retained earnings

6. Others

(5) Special reserves 986,869.15 986,869.15 1. Withdrawal in this period 1,939,719.02 1,939,719.02 2. Used in this period 952,849.87 952,849.87

(6) Others

-

4. Ending balance of the current period 387,267,000.00 629,031,414.80 10,214,147.45 751,195,733.51

275,316,828.74

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

3. Basic situation of the company

Suzhou Green Control Transmission Technology Co., Ltd. (hereinafter referred to as the "Company" or the "Company") was formerly known as Suzhou Green Control Transmission Technology Co., Ltd. (hereinafter referred to as "Green Control Co., Ltd."). It was registered with the Suzhou Wujiang Industrial and Commercial Bureau on December 29, 2011 and is headquartered in Suzhou City, Jiangsu Province. The company currently holds a business license with a unified social credit code of 913205095884505973.

On July 26, 2018, Green Control Co., Ltd. held a shareholders' meeting and decided to change Suzhou Green Control Transmission Technology Co., Ltd. into Suzhou Green Control Transmission Technology Co., Ltd. With March 31, 2018 as the base date, Green Control Co., Ltd. was changed into a joint-stock company as a whole. The capital contribution proportions of each shareholder before and after the change remained unchanged. After the change, the registered capital was RMB 50 million.

As of June 30, 2026, the company's registered capital was 387.267 million yuan. The registration place and business address of the company's headquarters: the west side of Bailong Road, Wujiang Economic and Technological Development Zone, Suzhou City. Legal representative: Li Lei.

The company's main business activities are: based on technological innovation related to electric drive systems, the company provides customers with electric drive systems, parts and related technology development and services. Electric drive systems are the driving force source and core key components of new energy vehicles and non-road mobile machinery. The company adheres to the concept of "safe and efficient definition of electric drive" and has overcome many technical difficulties in the field of pure electric and hybrid drive systems for commercial vehicles. The core products and components developed have the advantages of high reliability, high efficiency, integration and lightweight. They are widely used in the fields of commercial vehicles and non-road mobile machinery under new energy technology routes such as pure electric, plug-in hybrid (including extended range) and fuel cells. The company's main products are electric drive systems for new energy commercial vehicles, which are mainly used in pure electric, hybrid and fuel cell commercial vehicles and non-road mobile machinery.

The company's business scope: R&D, production, processing and sales of transmission equipment and related parts, automobile electronic control systems and related parts (the above products do not include rubber and plastics); repair, maintenance and after-sales service of transmission equipment and automobile electronic control systems; automobile sales; technical development, technical consultation and technical services of automobile transmission equipment and electronic control systems; production, processing and sales of precision equipment and spare parts; electricity sales business; self-owned house rental; car rental; equipment rental. (Projects that require approval according to law can only be carried out with the approval of relevant departments) General projects: import and export of goods; import and export of technology; sales of lubricants; sales of petroleum products (excluding hazardous chemicals) (Except for projects that require approval according to law, business activities can be carried out independently with a business license in accordance with the law)

Date of approval for issuance of financial statements: These financial statements have been approved for issuance by the company's board of directors on August 28, 2026.

4. Basis for preparation of financial statements

1. Basics of preparation

The company is based on going concern, recognizes and measures actual transactions and events in accordance with the Accounting Standards for Business Enterprises and their application guidelines and explanations of the standards, and prepares financial statements on this basis. In addition, the company also discloses relevant financial information in accordance with the China Securities Regulatory Commission's "Information Disclosure and Preparation Rules for Companies that Offer Securities to the Public No. 15 - General Provisions on Financial Reports (2023 Revision)".

2. Continued operations

The company has evaluated the company's ability to continue operating for 12 months from the end of the reporting period, and has found no events that affect the company's ability to continue operating. It is reasonable for the company to prepare financial statements based on going concern.

5. Important accounting policies and accounting estimates

Specific accounting policies and accounting estimation tips:

The following important accounting policies and accounting estimates of the Company are formulated in accordance with the Accounting Standards for Business Enterprises. Businesses not mentioned are carried out in accordance with the relevant accounting policies in the Accounting Standards for Business Enterprises.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

1. Statement on compliance with corporate accounting standards

The financial statements prepared by the company comply with the requirements of accounting standards for enterprises and truly and completely reflect the company's financial status, operating results, changes in owner's equity, cash flow and other relevant information.

2. Accounting period

The company's fiscal year begins on January 1 and ends on December 31 of the Gregorian calendar.

The current accounting period is from January 1, 2026 to June 30, 2026.

3. Business cycle

The company's normal operating cycle is one year.

4. Accounting standard currency

The company's accounting standard currency is RMB, and its overseas (branch) subsidiaries use the currency of the main economic environment in which they operate as the accounting standard currency.

5. Determination method and selection basis of importance standards

Applicable □Not applicable

Project Materiality Criteria

Accounts receivable whose individual provision amount accounts for more than 10% of the total bad debt provision for various types of receivables and is important in terms of individual provision for bad debts

The amount is greater than RMB 1 million

Bad debt provision for recovery or reversal of important accounts receivable with a single amount exceeding RMB 1 million

Write-off of important receivables Receivables with a single amount exceeding RMB 1 million

Significant changes in the book value of contract assets during the period The change in the book value of contract assets accounts for 30% of the balance of contract assets at the beginning of the period

The closing balance of a single project accounts for more than 10% of the closing balance of the project under construction and the amount incurred is important.

Or the balance is greater than RMB 10 million

Important debt investments due within one year or other debt investments with an amount greater than RMB 10 million

The amount of cash received related to important investment activities is greater than RMB 10 million

The amount of cash paid for important investment activities is greater than RMB 10 million

Important debt restructuring with an amount greater than RMB 10 million

6. Accounting treatment methods for business combinations under the same control and those not under the same control

(1) Business merger under common control

The assets and liabilities acquired by the company in a business merger are measured at the book value of the merged party in the consolidated financial statements of the ultimate controlling party on the merger date. Among them, if the accounting policies and accounting periods adopted by the merged party and the company before the business merger are different, the accounting policies and accounting periods will be unified based on the principle of importance, that is, the book value of the assets and liabilities of the merged party will be adjusted in accordance with the company's accounting policies and accounting periods. If there is a difference between the book value of the net assets acquired by the company in the business combination and the book value of the consideration paid, the capital reserve (capital premium or equity premium) will be adjusted first. If the balance of the capital reserve (capital premium or equity premium) is insufficient to offset it, the surplus reserve and undistributed profits will be offset in sequence.

For the accounting treatment method of business combination under common control achieved through step-by-step transactions, please refer to Note 5.7(5).

(2) Business combination not under common control

The identifiable assets and liabilities of the purchased party acquired by the Company in a business combination are measured at their fair value on the acquisition date. Among them, if the accounting policies and accounting periods adopted by the purchased party and the company before the business merger are different, the accounting policies and accounting periods shall be unified based on the principle of importance, that is, the book value of the assets and liabilities of the purchased party shall be adjusted in accordance with the accounting policies and accounting periods of the company. The company's merger cost on the acquisition date is greater than the acquired value obtained in the business merger.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

The difference in the fair value of the buyer's identifiable assets and liabilities is recognized as goodwill; if the merger cost is less than the difference in the fair value of the acquiree's identifiable assets and liabilities acquired in the business merger, first the merger cost and the fair value of the acquiree's identifiable assets and liabilities acquired in the business merger are reviewed. After review, if the merger cost is still less than the fair value of the acquiree's identifiable assets and liabilities, the difference is recognized as the profit or loss for the current period of the merger.

For the accounting treatment method of business combination not under common control achieved through step-by-step transactions, please refer to Note 5.7(5).

(3) Treatment of transaction costs in business mergers

Intermediary fees such as auditing, legal services, evaluation and consulting, and other related management fees incurred for business mergers are included in the current profit and loss when incurred. The transaction costs of equity securities or debt securities issued as consideration for the merger shall be included in the initial recognition amount of the equity securities or debt securities.

7. Judgment standards for control and preparation methods of consolidated financial statements

(1) Judgment criteria for control and determination of consolidation scope

Control means that the company has power over the investee, enjoys variable returns by participating in the investee's relevant activities, and has the ability to use its power over the investee to affect the amount of its returns. The definition of control includes three basic elements: first, the investor has power over the investee; second, it enjoys variable returns due to participation in the investee’s relevant activities; third, it has the ability to use its power over the investee to affect the amount of its returns. When the company's investment in the investee meets the above three elements, it indicates that the company can control the investee.

The scope of consolidation of consolidated financial statements is determined on the basis of control, including not only subsidiaries determined based on voting rights (or similar voting rights) themselves or in combination with other arrangements, but also structured entities determined based on one or more contractual arrangements.

Subsidiaries refer to entities controlled by the company (including divisible parts of enterprises, investee units, and structured entities controlled by enterprises, etc.). Structured entities refer to entities designed without voting rights or similar rights as a decisive factor when determining their controllers (note: sometimes also called special purpose entities).

(2) Preparation method of consolidated financial statements

The company prepares consolidated financial statements based on its own and its subsidiaries' financial statements and other relevant information.

The company prepares consolidated financial statements, treating the entire enterprise group as an accounting entity, and reflecting the overall financial status, operating results and cash flow of the enterprise group in accordance with the recognition, measurement and presentation requirements of relevant accounting standards for enterprises and in accordance with unified accounting policies and accounting periods.

① Consolidate the assets, liabilities, owners' equity, income, expenses, cash flow and other items of the parent company and subsidiaries.

② Offset the parent company’s long-term equity investment in the subsidiary with the parent company’s share of the subsidiary’s owner’s equity.

③ Offset the impact of internal transactions between the parent company and its subsidiaries, and between subsidiaries. If internal transactions indicate that impairment losses have occurred on related assets, the losses shall be recognized in full.

④Adjust special transaction matters from the perspective of the enterprise group.

(3) Processing of adding or removing subsidiaries during the reporting period

① Add subsidiaries or businesses

A. Subsidiaries or businesses added by business mergers under common control

(a) When preparing the consolidated balance sheet, adjust the opening balance of the consolidated balance sheet and adjust the relevant items in the comparative statement at the same time. It is deemed that the merged reporting entity has existed since the time when the ultimate controlling party began to control.

(b) When preparing the consolidated income statement, the income, expenses and profits of the subsidiary and the business combination from the beginning of the current period to the end of the reporting period are included in the consolidated income statement, and relevant items in the comparative statement are adjusted at the same time. It is deemed that the post-merger reporting entity has existed since the time when the ultimate controlling party began to control.

(c) When preparing the consolidated cash flow statement, the cash flows of the subsidiary and the business combination from the beginning of the current period to the end of the reporting period are included in the consolidated cash flow statement, and relevant items in the comparative statements are adjusted at the same time. It is deemed that the post-merger reporting entity has existed since the time when the ultimate controlling party began to control.

B. Subsidiaries or businesses added by business combination not under common control

(a) When preparing the consolidated balance sheet, the opening balance of the consolidated balance sheet will not be adjusted.

(b) When preparing the consolidated income statement, include the income, expenses and profits of the subsidiary and business from the date of purchase to the end of the reporting period into the consolidated income statement.

(c) When preparing the consolidated cash flow statement, include the cash flow from the acquisition date of the subsidiary to the end of the reporting period into the consolidated cash flow statement.

②Dispose of subsidiaries or businesses

A. When preparing the consolidated balance sheet, the opening balance of the consolidated balance sheet will not be adjusted.

B. When preparing the consolidated income statement, include the income, expenses and profits of the subsidiary and the business from the beginning of the period to the date of disposal into the consolidated income statement.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

C. When preparing the consolidated cash flow statement, include the cash flow of the subsidiary and the business from the beginning of the period to the disposal date into the consolidated cash flow statement.

(4) Special considerations in merger elimination

① The long-term equity investment held by a subsidiary of the company shall be regarded as the company's treasury shares, and shall be listed as "less: treasury shares" under the owner's equity item in the consolidated balance sheet as a deduction from the owner's equity.

For long-term equity investments held by subsidiaries among each other, the long-term equity investment and its corresponding share of the owner's equity of the subsidiary are offset against each other according to the offsetting method of the company's equity investment in the subsidiary.

② Since the "special reserves" and "general risk reserves" items are neither paid-in capital (or equity) nor capital reserves, nor are they different from retained earnings and undistributed profits, after the long-term equity investment and the subsidiary's owner's equity are offset, they will be restored according to the share attributable to the owners of the parent company.

③ If there is a temporary difference between the book value of assets and liabilities in the consolidated balance sheet and the tax basis of the taxable entity due to the offsetting of unrealized internal sales profits and losses, deferred income tax assets or deferred income tax liabilities will be recognized in the consolidated balance sheet, and the income tax expenses in the consolidated income statement will be adjusted at the same time, except for deferred income taxes related to transactions or events directly included in owner's equity and business mergers.

④ Unrealized internal transaction gains and losses arising from the company's sale of assets to subsidiaries shall be fully offset against "net profits attributable to owners of the parent company". Unrealized internal transaction profits and losses arising from the sale of assets by a subsidiary to the company shall be allocated and offset between "net profits attributable to owners of the parent company" and "minority shareholders' profits and losses" in accordance with the company's distribution ratio to the subsidiary. Unrealized internal transaction profits and losses arising from the sale of assets between subsidiaries shall be allocated and offset between "net profits attributable to owners of the parent company" and "minority shareholders' profits and losses" in accordance with the company's distribution ratio to the selling subsidiary.

⑤ If the current losses shared by minority shareholders of a subsidiary exceed the minority shareholders' share of the subsidiary's opening owner's equity, the balance should still be offset against minority shareholders' equity.

(5) Accounting treatment of special transactions

①Purchase minority shareholders’ equity

The Company purchases the equity of a subsidiary owned by minority shareholders of the subsidiary. In the individual financial statements, the investment cost of the newly acquired long-term equity investment for the purchase of the minority equity is measured according to the fair value of the consideration paid. In the consolidated financial statements, the difference between the newly acquired long-term equity investment due to the purchase of minority shares and the share of the subsidiary's net assets calculated continuously from the date of purchase or merger based on the new shareholding ratio shall be adjusted to the capital reserve (capital premium or equity premium). If the capital reserve is insufficient to offset, the surplus reserve and undistributed profits shall be offset in sequence.

② Obtaining control of a subsidiary step by step through multiple transactions

A. The merger of enterprises under the same control is realized step by step through multiple transactions.

On the merger date, the company determines the initial investment cost of the long-term equity investment in its individual financial statements based on the share of the book value of the subsidiary's net assets in the ultimate controlling party's consolidated financial statements that it will enjoy after the merger; the initial investment cost is the same as the long-term equity before the merger. The difference between the book value of the investment and the sum of the book value of the newly paid consideration for further shares acquired on the merger date is adjusted to the capital reserve (capital premium or equity premium). If the capital reserve (capital premium or equity premium) is insufficient to offset, the surplus reserve and undistributed profits are offset in sequence.

In the consolidated financial statements, the assets and liabilities of the merged party obtained by the combining party during the merger are measured according to their book value in the consolidated financial statements of the ultimate controlling party on the date of merger, except for adjustments due to differences in accounting policies and accounting periods. The difference between the book value of the investments held before the merger plus the book value of the new consideration paid on the date of merger and the book value of the net assets acquired in the merger is adjusted to the capital reserve (equity premium/capital premium). If the capital reserve is insufficient for offset, the retained earnings are adjusted.

For equity investments held by the merging party before acquiring control of the merged party, relevant profits and losses, other comprehensive income and other changes in owner's equity have been recognized between the date of acquisition of the original equity and the date when the merging party and the merged party are under the final control of the same party, whichever is later, to the merger date, and shall be offset against the opening retained earnings or current profits and losses of the comparative statement period respectively.

B. Merger of enterprises not under common control is realized step by step through multiple transactions.

On the merger date, in individual financial statements, the sum of the book value of the original long-term equity investment plus the new investment cost on the merger date will be regarded as the initial investment cost of the long-term equity investment on the merger date.

In the consolidated financial statements, the equity of the purchased party held before the acquisition date is re-measured according to the fair value of the equity on the acquisition date. If the equity of the acquired party held before the acquisition date is designated as a financial asset measured at fair value and its changes are included in other comprehensive income, the difference between the fair value and its book value is included in retained earnings. The equity was originally included in the accumulation of other comprehensive income. Changes in fair value are transferred out to retained earnings; if the equity of the purchased party held before the purchase date is a financial asset measured at fair value and its changes are included in the current profit and loss or a long-term equity investment accounted for by the equity method, the difference between the fair value and its book value is included in the investment income of the current period; the equity of the purchased party held before the purchase date involves other comprehensive income under equity method accounting and other comprehensive income under equity method accounting.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

For changes in other owners' equity other than net profit and loss, other comprehensive income and profit distribution, the other comprehensive income related to it will be accounted for on the date of purchase on the same basis as the investee's direct disposal of relevant assets or liabilities, and the changes in other owners' equity related to it will be converted into investment income for the current period on the date of purchase. ③The company disposes of long-term equity investment in subsidiaries but does not lose control

If the parent company partially disposes of its long-term equity investment in a subsidiary without losing control, in the consolidated financial statements, the difference between the disposal price and the share of the subsidiary's net assets continuously calculated from the date of purchase or merger will be adjusted to the capital reserve (capital premium or equity premium). If the capital reserve is insufficient for offset, the retained earnings will be adjusted.

④The company disposes of its long-term equity investment in the subsidiary and loses control

A. One transaction disposal

If the company loses control over the investee due to disposal of part of its equity investment or other reasons, when preparing consolidated financial statements, the remaining equity will be remeasured according to its fair value on the date when control is lost. The difference between the sum of the consideration obtained for disposing of the equity and the fair value of the remaining equity, minus the share of the original subsidiary's net assets calculated continuously from the date of purchase or merger based on the original shareholding ratio and the sum of goodwill, shall be included in the investment income in the period when control is lost.

Other comprehensive income related to the equity investment of the atomic company will be accounted for on the same basis as the original subsidiary's direct disposal of relevant assets or liabilities when control is lost. Other changes in owner's equity related to the original subsidiary that are accounted for under the equity method will be transferred to the current profit and loss when control is lost.

B. Step-by-step disposal of multiple transactions

In the consolidated financial statements, we should first determine whether the step-by-step transaction is a "package transaction".

If the step-by-step transaction does not belong to a "package transaction", in the individual financial statements, for each transaction before the loss of control of the subsidiary, the book value of the long-term equity investment corresponding to each equity disposal will be carried forward, and the difference between the proceeds and the book value of the long-term equity investment disposed shall be included in the investment income of the current period; in the consolidated financial statements, it shall be handled in accordance with the relevant provisions of "the parent company disposes of the long-term equity investment in the subsidiary without losing control."

If the step-by-step transaction is a "package transaction", each transaction should be accounted for as a transaction in which the subsidiary is disposed of and control is lost; in individual financial statements, the difference between the price of each disposal before the loss of control and the book value of the long-term equity investment corresponding to the equity disposed is first recognized as other comprehensive income. When control is lost, it will be transferred to the profit and loss of the current period when control is lost; in the consolidated financial statements, for each transaction before the loss of control, the difference between the disposal price and the share of the net assets of the subsidiary corresponding to the disposal investment should be recognized as other comprehensive income, and when control is lost, it will be transferred to the profit and loss of the current period when control is lost.

If the terms, conditions and economic impact of each transaction meet one or more of the following conditions, multiple transactions are usually accounted for as a "package transaction":

(a) The transactions were entered into simultaneously or with consideration of their influence on each other.

(b) These transactions as a whole can achieve a complete business result.

(c) The occurrence of a transaction depends on the occurrence of at least one other transaction.

(d) A transaction that is uneconomical when considered alone is economical when considered together with other transactions.

⑤ Dilution of the equity ratio owned by the parent company due to capital increase by minority shareholders of the sub-company

Other shareholders (minority shareholders) of the subsidiary increase capital in the subsidiary, thereby diluting the parent company's equity ratio in the subsidiary. In the consolidated financial statements, the share of the subsidiary's book net assets before the capital increase is calculated based on the parent company's equity ratio before the capital increase. The difference between this share and the subsidiary's share of the subsidiary's book net assets after the capital increase calculated based on the parent company's shareholding ratio after the capital increase is adjusted to the capital reserve (capital premium or equity premium). If the capital reserve (capital premium or equity premium) is insufficient to offset, the retained earnings are adjusted.

8. Classification of joint arrangements and accounting treatment methods for joint operations

A joint arrangement refers to an arrangement that is jointly controlled by two or more parties. The Company's joint venture arrangements are divided into joint operations and joint ventures. (1) Joint operation

A joint operation refers to a joint arrangement in which the Company enjoys the relevant assets of the arrangement and assumes the relevant liabilities of the arrangement.

The company confirms the following items related to its share of interests in joint operations, and performs accounting treatments in accordance with the relevant accounting standards for enterprises:

① Recognize the assets held individually and recognize the assets held jointly according to their shares;

② Confirm the liabilities borne individually and the liabilities borne jointly according to their shares;

③ Recognize the income generated from the sale of its share of joint operating output;

④ Recognize the income generated by the joint operation from the sale of output according to its share;

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

⑤ Recognize the expenses incurred individually, and recognize the expenses incurred by joint operations according to their share.

(2) Joint venture

A joint venture is a joint arrangement in which the Company only has rights to the net assets of the arrangement.

The Company accounts for investments in joint ventures in accordance with the provisions on equity method accounting for long-term equity investments.

9. Determination standards for cash and cash equivalents

Cash refers to corporate cash on hand and deposits that can be used for payment at any time. Cash equivalents refer to investments that are held for a short period (generally due within three months from the date of purchase), are highly liquid, are easily convertible into known amounts of cash, and have little risk of changes in value.

10. Foreign currency business and foreign currency statement conversion

(1) Method for determining the conversion exchange rate in foreign currency transactions

When the Company's foreign currency transactions are initially recognized, they are converted into the accounting functional currency using the spot exchange rate on the date of the transaction or an exchange rate determined in a systematic and reasonable manner that is approximate to the spot exchange rate on the date of the transaction (hereinafter referred to as the "approximate exchange rate of the spot exchange rate").

(2) Conversion method of foreign currency monetary items on the balance sheet date

On the balance sheet date, foreign currency monetary items are translated using the spot exchange rate on the balance sheet date. Exchange differences arising from differences between the spot exchange rate on the balance sheet date and the spot exchange rate on initial recognition or the previous balance sheet date are included in the current profit and loss. For foreign currency non-monetary items measured at historical cost, the spot exchange rate on the date of transaction is still used for translation; for inventories measured at the lower of cost and net realizable value, the inventory is purchased in foreign currency and the net realizable value of the inventory on the balance sheet date is If the value is reflected in a foreign currency, the net realizable value is first converted into the recording currency amount according to the spot exchange rate on the balance sheet date, and then compared with the inventory cost reflected in the recording currency to determine the ending value of the inventory; for fair value Foreign currency non-monetary items measured at fair value are converted using the spot exchange rate on the date when the fair value is determined. For financial assets measured at fair value with changes included in current profits and losses, the difference between the converted accounting functional currency amount and the original accounting functional currency amount The amount is included in the current profit and loss. For non-trading equity instrument investments designated as measured at fair value and whose changes are included in other comprehensive income, the difference between the converted accounting functional currency amount and the original accounting functional currency amount is included in other comprehensive income.

(3) Conversion method of foreign currency statements

Before converting the financial statements of an enterprise's overseas operations, it is necessary to adjust the accounting period and accounting policies of the overseas operations to make them consistent with the accounting period and accounting policies of the enterprise, and then prepare financial statements in the corresponding currency (currency other than the accounting standard currency) based on the adjusted accounting policies and accounting periods, and then convert the financial statements of the overseas operations according to the following method:

① The assets and liability items in the balance sheet are translated using the spot exchange rate on the balance sheet date. Owner's equity items, except for the "undistributed profits" items, are translated using the spot exchange rate at the time of occurrence.

② The income and expense items in the income statement are converted using the spot exchange rate on the date of transaction or an approximate exchange rate of the spot exchange rate.

③ Foreign currency cash flows and cash flows of overseas subsidiaries are translated using the spot exchange rate on the date of cash flow occurrence or an approximate exchange rate of the spot exchange rate. The impact of exchange rate changes on cash should be presented separately in the cash flow statement as an adjustment item.

④ The resulting translation difference of foreign currency financial statements shall be listed in the "other comprehensive income" item under the owner's equity item in the consolidated balance sheet when preparing the consolidated financial statements.

When an overseas operation is disposed of and control is lost, the translation difference of foreign currency statements listed under the owner's equity item in the balance sheet and related to the overseas operation shall be transferred to the current profit and loss of the disposal in full or in proportion to the disposal of the overseas operation.

11. Financial instruments

A financial instrument refers to a contract that forms a financial asset of one party and a financial liability or equity instrument of another party.

(1) Recognition and derecognition of financial instruments

When the company becomes a party to a financial instrument contract, the relevant financial assets or financial liabilities are recognized.

Financial assets shall be derecognized if they meet one of the following conditions:

①The contractual right to receive cash flows from the financial asset terminates;

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

②The financial asset has been transferred and meets the following conditions for derecognition of financial asset transfer.

If the current obligation of a financial liability (or part thereof) has been discharged, the financial liability (or part thereof) shall be derecognised. An agreement is signed between the company (borrower) and the lender to replace the original financial liability by assuming a new financial liability, and if the contract terms of the new financial liability are substantially different from the original financial liability, the original financial liability will be derecognised and the new financial liability will be recognized at the same time. If the company makes substantial modifications to the contract terms of the original financial liability (or part thereof), it shall terminate the original financial liability and recognize a new financial liability in accordance with the modified terms.

When financial assets are bought and sold in a regular manner, accounting recognition and derecognition will be carried out based on the transaction date. The conventional way of buying and selling financial assets refers to delivering financial assets in accordance with the terms of the contract and at the time schedule determined by regulations or market practices. The trading day refers to the date when the company commits to buy or sell financial assets.

(2) Classification and measurement of financial assets

Upon initial recognition, based on the business model of managing financial assets and the contractual cash flow characteristics of financial assets, the company classifies financial assets into: financial assets measured at amortized cost, financial assets measured at fair value with changes included in current profits and losses, and financial assets measured at fair value with changes included in other comprehensive income. Financial assets may not be reclassified after initial recognition unless the Company changes the business model in which the financial assets are managed, in which case all affected related financial assets are reclassified on the first day of the first reporting period following the change in business model.

Financial assets are measured at fair value upon initial recognition. For financial assets measured at fair value and whose changes are included in the current profit and loss, the relevant transaction costs are directly included in the current profit and loss, and the relevant transaction costs of other types of financial assets are included in their initial recognition amount. Notes receivable and accounts receivable arising from the sale of goods or provision of services, which do not contain or take into account significant financing components, are initially measured by the company based on the transaction price defined in the revenue standards.

The subsequent measurement of a financial asset depends on its classification:

①Financial assets measured at amortized cost

If a financial asset meets the following conditions at the same time, it is classified as a financial asset measured at amortized cost: the company's business model for managing the financial asset is to collect contractual cash flows as the goal; the contractual terms of the financial asset stipulate that the cash flow generated on a specific date is only the payment of principal and interest based on the outstanding principal amount. For such financial assets, the actual interest rate method is used and subsequent measurement is carried out at amortized cost. Gains or losses arising from their derecognition, amortization or impairment based on the actual interest rate method are included in the current profits and losses.

②Financial assets measured at fair value and changes included in other comprehensive income

If a financial asset meets the following conditions at the same time, it is classified as a financial asset measured at fair value with changes included in other comprehensive income: the company's business model for managing this financial asset is to collect contractual cash flows as well as sell financial assets as the goal; the contract terms of the financial asset stipulate that the cash flow generated on a specific date is only the payment of principal and interest based on the outstanding principal amount. For such financial assets, fair value is used for subsequent measurement. Except for impairment losses or gains and exchange gains and losses that are recognized as current profits and losses, changes in the fair value of such financial assets are recognized as other comprehensive income until the financial assets are derecognised, and their accumulated profits or losses are transferred to current profits and losses. However, the interest income related to the financial asset calculated using the actual interest rate method is included in the current profit and loss.

The Company irrevocably chooses to designate some non-trading equity instrument investments as financial assets measured at fair value with changes included in other comprehensive income. Only relevant dividend income will be included in the current profit and loss, and changes in fair value will be recognized as other comprehensive income until the financial assets are derecognised, and their accumulated gains or losses will be transferred to retained earnings.

③Financial assets measured at fair value and changes included in current profits and losses

Financial assets other than the above-mentioned financial assets measured at amortized cost and financial assets measured at fair value through other comprehensive income are classified as financial assets measured at fair value through profit or loss for the current period. For such financial assets, fair value is used for subsequent measurement, and all changes in fair value are included in the current profit and loss.

(3) Classification and measurement of financial liabilities

The Company classifies financial liabilities into financial liabilities measured at fair value through current profits and losses, loan commitments and financial guarantee contract liabilities for loans with lower than market interest rates, and financial liabilities measured at amortized cost.

The subsequent measurement of financial liabilities depends on their classification:

①Financial liabilities measured at fair value and changes included in current profits and losses

This type of financial liabilities includes trading financial liabilities (including derivatives that are financial liabilities) and financial liabilities designated as measured at fair value with changes included in current profits and losses. After initial recognition, such financial liabilities are subsequently measured at fair value. Except for those related to hedging accounting, the gains or losses (including interest expenses) incurred are included in the current profits and losses. However, for financial liabilities designated by the Company as measured at fair value and whose changes are included in current profits and losses, the change in the fair value of the financial liability caused by changes in its own credit risk is included in other comprehensive income. When the financial liability is derecognised, the accumulated gains and losses previously included in other comprehensive income should be transferred out from other comprehensive income and included in retained earnings.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

②Loan commitments and financial guarantee contract liabilities

A loan commitment is a commitment provided by the Company to customers to provide loans to customers under established contract terms during the commitment period. Loan commitments are provided with impairment losses based on the expected credit loss model.

A financial guarantee contract refers to a contract that requires the company to pay a specific amount of compensation to the contract holder who has suffered a loss when a specific debtor is unable to repay its debts in accordance with the terms of the original or modified debt instrument when due. Financial guarantee contract liabilities are subsequently measured based on the higher of the loss reserve amount determined based on the impairment principle of financial instruments and the initial recognition amount minus the accumulated amortization amount determined based on the revenue recognition principle.

③Financial liabilities measured at amortized cost

After initial recognition, other financial liabilities are measured at amortized cost using the effective interest rate method.

Except for special circumstances, financial liabilities and equity instruments are distinguished according to the following principles:

① If the company cannot unconditionally avoid delivering cash or other financial assets to fulfill a contractual obligation, then the contractual obligation meets the definition of a financial liability. Although some financial instruments do not explicitly contain terms and conditions for the obligation to deliver cash or other financial assets, they may indirectly form contractual obligations through other terms and conditions.

② If a financial instrument must be settled or can be settled with the company's own equity instruments, it is necessary to consider whether the company's own equity instruments used to settle the instrument are used as a substitute for cash or other financial assets, or to enable the holder of the instrument to enjoy the remaining equity in the issuer's assets after deducting all liabilities. If it is the former, the instrument is a financial liability of the issuer; if it is the latter, the instrument is an equity instrument of the issuer. In some cases, a financial instrument contract stipulates that the company must use or use its own equity instruments to settle the financial instrument, and the amount of the contractual rights or contractual obligations is equal to the number of its own equity instruments that can be obtained or needs to be delivered multiplied by its fair value at the time of settlement. Regardless of whether the amount of the contractual rights or contractual obligations is fixed or is based entirely or partially on changes in variables other than the market price of the company's own equity instruments (such as interest rates, the price of a certain commodity or the price of a certain financial instrument), the contract is classified as a financial liability.

(4) Derivative financial instruments and embedded derivatives

Derivative financial instruments are initially measured at their fair value on the date when the derivative transaction contract is signed, and are subsequently measured at their fair value. Derivative financial instruments with a positive fair value are recognized as an asset and those with a negative fair value are recognized as a liability.

Except for the effective part of the cash flow hedging, which is included in other comprehensive income and transferred out and included in the current profit and loss when the hedged item affects the profit and loss, gains or losses arising from changes in the fair value of derivative instruments are directly included in the current profit and loss.

For hybrid instruments containing embedded derivatives, such as if the main contract is a financial asset, the relevant provisions on the classification of financial assets shall apply to the hybrid instrument as a whole. If the main contract is not a financial asset, and the hybrid instrument is not measured at fair value and its changes are included in the current profit and loss for accounting treatment, and there is no close relationship between the embedded derivative instrument and the main contract in terms of economic characteristics and risks, and if the conditions of the embedded derivative instrument are the same and the stand-alone instrument meets the definition of a derivative, the embedded derivative instrument is separated from the hybrid instrument and treated as a separate derivative financial instrument. If the fair value of the embedded derivative cannot be measured separately on the acquisition date or subsequent balance sheet date, the hybrid instrument as a whole is designated as a financial asset or financial liability at fair value through profit or loss for the current period.

(5) Impairment of financial instruments

The Company recognizes loss provisions based on expected credit losses for financial assets measured at amortized cost, debt investments measured at fair value with changes included in other comprehensive income, contract assets, lease receivables, loan commitments and financial guarantee contracts, etc.

①Measurement of expected credit losses

Expected credit losses refer to the weighted average of the credit losses of financial instruments with the risk of default as the weight. Credit loss refers to the difference between all contractual cash flows receivable under the contract and all cash flows expected to be received by the company, discounted at the original actual interest rate, that is, the present value of all cash shortfalls. Among them, credit-impaired financial assets purchased or originated by the company should be discounted according to the credit-adjusted actual interest rate of the financial assets.

Lifetime expected credit losses refer to the expected credit losses caused by all possible default events that may occur during the entire expected life of a financial instrument.

Expected credit losses within the next 12 months refer to the expected credit losses caused by default events on financial instruments that may occur within 12 months after the balance sheet date (if the expected duration of the financial instrument is less than 12 months, the expected duration), and are part of the expected credit losses throughout the duration.

On each balance sheet date, the Company measures the expected credit losses of financial instruments at different stages respectively. If the credit risk of a financial instrument has not increased significantly since initial recognition, it is in the first stage, and the Company will measure loss provisions based on the expected credit losses within the next 12 months; if the credit risk of a financial instrument has increased significantly since initial recognition but no credit impairment has occurred, it is in the second stage, and the Company will measure loss provisions based on the expected credit losses throughout the entire duration of the instrument; if a financial instrument has experienced credit impairment since initial recognition, it is in the third stage, and the Company will measure loss provisions based on the expected credit losses throughout the entire duration of the instrument.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

For financial instruments with low credit risk on the balance sheet date, the company assumes that its credit risk has not increased significantly since initial recognition, and measures loss provisions based on expected credit losses within the next 12 months.

For financial instruments in the first and second stages and with lower credit risk, the company calculates interest income based on its book balance before impairment provisions and actual interest rate. For financial instruments in the third stage, interest income is calculated based on its book balance minus the amortized cost and actual interest rate after impairment provisions have been made.

For notes receivable, accounts receivable, receivable financing and contract assets, regardless of whether there is a significant financing component, the company measures loss provisions based on expected credit losses throughout the duration.

A. Receivables/Contract Assets

For bills receivable, accounts receivable, other receivables, receivables financing, contract assets and long-term receivables where there is objective evidence of impairment, and other bills receivable, accounts receivable, contract assets and long-term receivables that are subject to individual assessment, individual impairment tests are conducted, expected credit losses are confirmed, and individual impairment provisions are made. For notes receivable, accounts receivable, other receivables, receivables financing, contract assets and long-term receivables where there is no objective evidence of impairment or when a single financial asset cannot assess expected credit losses at a reasonable cost, the company divides notes receivable, accounts receivable, other receivables, receivables financing, contract assets and long-term receivables into several combinations based on credit risk characteristics, and calculates expected credit losses on the basis of the combinations. The basis for determining the combinations is as follows:

The basis for determining the combination of notes receivable is as follows:

Notes Receivable Portfolio 1 Bank Acceptance Bill

Notes Receivable Portfolio 2 Finance Company Acceptance Bill

Notes Receivable Portfolio 3 Commercial Acceptance Bill

For notes receivable divided into portfolios, the Company refers to historical credit loss experience, combines current conditions and predictions of future economic conditions, and calculates expected credit losses through default risk exposure and the expected credit loss rate throughout the duration.

The basis for determining the combination of accounts receivable is as follows:

Accounts receivable portfolio 1 Related parties within the scope of consolidation

Accounts receivable portfolio 2 Other customers outside the scope of consolidation

For accounts receivable divided into portfolios, the Company refers to historical credit loss experience, combined with current conditions and predictions of future economic conditions, prepares a comparison table between the aging of accounts receivable and the expected credit loss rate for the entire duration, and calculates expected credit losses.

The basis for determining the combination of other receivables is as follows:

Other receivables portfolio 1 Interest receivable

Other receivables portfolio 2 Dividends receivable

Other receivables portfolio 3 Related parties within the scope of consolidation

Other receivables portfolio 4 Other customers outside the scope of consolidation

For other receivables classified into portfolios, the Company refers to historical credit loss experience, combined with current conditions and predictions of future economic conditions, and calculates expected credit losses through default risk exposure and expected credit loss rate within the next 12 months or the entire duration.

The basis for determining the combination of receivables financing is as follows:

Receivables Financing Portfolio 1 Commercial Acceptance Bill

Receivables Financing Package 2 Bank Acceptance Bill

Receivables Financing Portfolio 3 Related parties within the scope of consolidation

Receivables Financing Portfolio 4 Other customers outside the scope of consolidation

For the financing of receivables divided into portfolios, the Company refers to historical credit loss experience, combines current conditions and predictions of future economic conditions, and calculates expected credit losses through default risk exposure and the expected credit loss rate throughout the duration.

The basis for determining the combination of contract assets is as follows:

Contract asset portfolio 1 Unexpired warranty deposit

For contract assets divided into portfolios, the Company refers to historical credit loss experience, combines current conditions and predictions of future economic conditions, and calculates expected credit losses through default risk exposure and the expected credit loss rate throughout the duration.

The basis for determining the combination of long-term receivables is as follows:

Long-term receivables portfolio 1 Lease receivables

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Long-term receivables portfolio 2 Other receivables

For long-term receivables classified as Portfolio 1, the Company refers to historical credit loss experience, combines current conditions and predictions of future economic conditions, and calculates expected credit losses through default risk exposure and the expected credit loss rate throughout the duration.

For long-term receivables classified into Portfolio 2, the Company refers to historical credit loss experience, combined with current conditions and predictions of future economic conditions, and calculates expected credit losses through default risk exposure and expected credit loss rate within the next 12 months or the entire duration.

B. Debt investment and other debt investments

For debt investments and other debt investments, the Company calculates expected credit losses based on the nature of the investment, various types of counterparties and risk exposures, and through the default risk exposure and the expected credit loss rate within the next 12 months or throughout the duration.

② Has lower credit risk

If the default risk of a financial instrument is low, the borrower has a strong ability to fulfill its contractual cash flow obligations in the short term, and even if there are adverse changes in the economic situation and operating environment in the longer term, it may not necessarily reduce the borrower's ability to fulfill its contractual cash flow obligations, the financial instrument is considered to have lower credit risk.

③Credit risk increases significantly

The Company compares the default probability of the financial instrument within the expected duration determined on the balance sheet date with the default probability within the expected duration determined at the time of initial recognition to determine the relative change in the default probability of the financial instrument during the expected duration to assess whether the credit risk of the financial instrument has increased significantly since the initial recognition.

When determining whether credit risk has increased significantly since initial recognition, the Company considers reasonable and supportable information, including forward-looking information, that is available without unnecessary additional cost or effort. Information considered by the Company includes:

A. Whether there are significant changes in internal price indicators caused by changes in credit risk;

B. Adverse changes in business, financial or economic conditions that are expected to result in significant changes in the debtor's ability to fulfill its debt repayment obligations;

C. Whether there is a significant change in the actual or expected operating results of the debtor; whether there is a significant adverse change in the regulatory, economic or technical environment in which the debtor operates; D. whether there is a significant change in the value of the collateral used as collateral for the debt or the quality of the guarantee or credit enhancement provided by a third party. These changes are expected to reduce the debtor's economic incentives to repay within the contractual period or affect the probability of default;

E. Whether there is a significant change in the economic motivation that is expected to reduce the debtor's repayment within the contract period;

F. Anticipated changes in the loan contract, including whether anticipated breaches of the contract may result in the exemption or revision of contractual obligations, the granting of interest-free periods, jumps in interest rates, requirements for additional collateral or guarantees, or other changes to the contractual framework of financial instruments;

G. Whether the debtor’s expected performance and repayment behavior have changed significantly;

H. Whether the contract payment is overdue for more than 30 days (inclusive).

Depending on the nature of the financial instrument, the Company evaluates whether the credit risk has increased significantly on the basis of a single financial instrument or a combination of financial instruments. When evaluating based on a portfolio of financial instruments, the Company may classify financial instruments based on common credit risk characteristics, such as overdue information and credit risk ratings.

Normally, if it is overdue for more than 30 days, the Company determines that the credit risk of a financial instrument has increased significantly. Unless the company can obtain reasonable and evidence-based information without excessive cost or effort, proving that although the payment period stipulated in the contract has exceeded 30 days, the credit risk has not increased significantly since the initial recognition.

④ Financial assets that have suffered credit impairment

The Company assesses whether credit impairment has occurred on financial assets measured at amortized cost and debt investments measured at fair value through other comprehensive income on the balance sheet date. When one or more events that have an adverse impact on the expected future cash flows of a financial asset occur, the financial asset becomes a credit-impaired financial asset. Evidence that a financial asset has been credit-impaired includes the following observable information:

The issuer or the debtor encounters significant financial difficulties; the debtor breaches the contract, such as default or overdue payment of interest or principal; the creditor grants the debtor concessions that would not be made under any other circumstances due to economic or contractual considerations related to the debtor's financial difficulties; the debtor is likely to go bankrupt or undergo other financial reorganization; the issuer or debtor's financial difficulties cause the active market for the financial asset to disappear; a financial asset is purchased or originated at a substantial discount, and the discount reflects the fact that a credit loss has occurred.

⑤ Presentation of expected credit loss provisions

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In order to reflect changes in the credit risk of financial instruments since initial recognition, the company remeasures expected credit losses on each balance sheet date, and the resulting increase or reversal of loss provisions shall be included in the current profit and loss as impairment losses or gains. For financial assets measured at amortized cost, the loss provision is deducted from the book value of the financial asset listed in the balance sheet; for debt investments measured at fair value with changes included in other comprehensive income, the company recognizes its loss provision in other comprehensive income and does not deduct the book value of the financial asset.

⑥Writing off

If the company no longer reasonably expects that the contractual cash flows of a financial asset can be fully or partially recovered, it will directly write down the book balance of the financial asset. Such a write-down constitutes the derecognition of the relevant financial asset. This situation typically occurs when the Company determines that the debtor does not have the assets or sources of income to generate sufficient cash flow to repay the amount that will be written down.

If a financial asset that has been written down is later recovered, the reversal of the impairment loss will be included in the profit and loss of the current period of recovery.

(6) Transfer of financial assets

Financial asset transfer refers to the following two situations:

A. Transfer the contractual right to receive cash flows from financial assets to another party;

B. Transfer the financial asset in whole or in part to another party, but retain the contractual right to collect the cash flow from the financial asset and assume the contractual obligation to pay the collected cash flow to one or more payees.

① Termination of recognition of transferred financial assets

If substantially all the risks and rewards of ownership of a financial asset have been transferred to the transferee, or if substantially all the risks and rewards of ownership of a financial asset have neither been transferred nor retained, but control of the financial asset has been given up, the financial asset shall be derecognised.

When judging whether control of the transferred financial assets has been given up, the actual ability of the transferee to sell the financial assets is used. If the transferee can unilaterally sell the transferred financial assets as a whole to an unrelated third party, and there are no additional conditions to restrict this sale, the company has given up control of the financial assets. When the Company determines whether the transfer of financial assets meets the conditions for derecognition of financial assets, the Company pays attention to the essence of the transfer of financial assets.

If the overall transfer of financial assets meets the conditions for derecognition, the difference between the following two amounts will be included in the current profit and loss:

A. Book value of the transferred financial assets;

B. The sum of the consideration received due to the transfer and the amount of the derecognition portion of the accumulated changes in fair value that were originally directly included in other comprehensive income (the financial assets involved in the transfer are financial assets classified as financial assets measured at fair value and their changes are included in other comprehensive income in accordance with Article 18 of "Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments").

If a partial transfer of a financial asset meets the conditions for derecognition, the overall book value of the transferred financial asset shall be apportioned between the derecognized part and the non-derecognized part (in this case, the retained service assets shall be deemed to be part of the continued recognition of financial assets) according to their respective relative fair values on the date of transfer, and the difference between the following two amounts shall be included in the current profit and loss:

A. The book value of the derecognized part on the date of derecognition;

B. The sum of the consideration for the derecognition part and the amount corresponding to the derecognition part of the cumulative amount of changes in fair value originally included in other comprehensive income (the financial assets involved in the transfer are financial assets classified as financial assets measured at fair value and their changes are included in other comprehensive income in accordance with Article 18 of "Accounting Standards for Business Enterprises No. 22 - Recognition and Measurement of Financial Instruments").

② Continue to be involved in the transferred financial assets

If it neither transfers nor retains substantially all the risks and rewards of ownership of a financial asset, and does not give up control of the financial asset, the relevant financial assets shall be recognized to the extent of its continued involvement in the transferred financial assets, and the relevant liabilities shall be recognized accordingly.

The degree of continued involvement in the transferred financial assets refers to the degree of risk or reward that the enterprise bears from changes in the value of the transferred financial assets.

③Continue to recognize the transferred financial assets

If it still retains substantially all the risks and rewards of ownership of the transferred financial assets, the entire transferred financial assets should continue to be recognized, and the consideration received should be recognized as a financial liability.

The financial assets and the recognized related financial liabilities shall not be offset against each other. In subsequent accounting periods, the enterprise shall continue to recognize the income (or gains) generated by the financial assets and the expenses (or losses) generated by the financial liabilities.

(7) Offset of financial assets and financial liabilities

Financial assets and financial liabilities shall be presented separately in the balance sheet and shall not be offset against each other. However, if the following conditions are met at the same time, the net amount after offsetting each other will be presented in the balance sheet:

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

The company has the legal right to offset the recognized amount, and such legal right is currently enforceable;

The Company plans to settle on a net basis, or to realize the financial assets and pay off the financial liabilities at the same time.

For transfers of financial assets that do not meet the conditions for derecognition, the transferor shall not offset the transferred financial assets and related liabilities.

(8) Method for determining fair value of financial instruments

Fair value refers to the price that can be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The company measures the fair value of relevant assets or liabilities at the price in the main market. If there is no main market, the company measures the fair value of the relevant assets or liabilities at the most favorable market price. The Company adopts the assumptions used by market participants to maximize their economic interests when pricing the asset or liability. The main market refers to the market with the largest transaction volume and the highest level of transaction activity for the relevant assets or liabilities; the most favorable market refers to the market in which the relevant assets can be sold at the highest amount or the relevant liabilities can be transferred at the lowest amount after taking into account transaction costs and transportation costs.

For financial assets or financial liabilities that have an active market, the Company determines their fair value using quotes in the active market. If there is no active market for a financial instrument, the Company uses valuation techniques to determine its fair value.

When measuring non-financial assets at fair value, the ability of market participants to use the asset for its best purpose to generate economic benefits is considered, or the ability to sell the asset to other market participants who can use it for its best purpose to generate economic benefits.

①Valuation technology

The Company adopts valuation techniques that are applicable under the current circumstances and supported by sufficient available data and other information. The valuation techniques used mainly include: market method, income method and cost method. The company uses a method consistent with one or more of the valuation techniques to measure fair value. If it uses multiple valuation techniques to measure fair value, it considers the rationality of each valuation result and selects the amount that best represents the fair value under the current circumstances as the fair value.

In the application of valuation techniques, the Company gives priority to the use of relevant observable input values, and only uses unobservable input values ​​when relevant observable input values ​​cannot be obtained or are impractical to obtain. Observable input values ​​refer to input values ​​that can be obtained from market data. This input reflects the assumptions used by market participants when pricing the underlying asset or liability. Unobservable input values ​​refer to input values ​​that cannot be obtained from market data. The input is based on the best available information about the assumptions used by market participants in pricing the underlying asset or liability.

②Fair value level

The company divides the input values used in fair value measurement into three levels, and first uses the first level input values, then uses the second level input values, and finally uses the third level input values. The first level input value is the unadjusted quoted price in an active market for the same asset or liability that can be obtained on the measurement date. The second level input value is the directly or indirectly observable input value of the relevant assets or liabilities in addition to the first level input value. Level 3 input values ​​are unobservable input values ​​for related assets or liabilities.

12. Notes receivable

See Note 5.11 for details.

13. Accounts receivable

See Note 5.11 for details.

14. Accounts receivable financing

See Note 5.11 for details.

15. Other receivables

Determination method and accounting treatment method of expected credit losses of other receivables

See Note 5.11 for details.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

16. Contract assets

The Company presents contract assets or contract liabilities in the balance sheet based on the relationship between performance obligations and customer payments. Consideration that the Company has a right to receive for transferring goods or providing services to a customer (and that right is dependent on factors other than the passage of time) is shown as a contract asset. The Company's obligations to transfer goods or provide services to customers for consideration received or receivable from customers are listed as contract liabilities.

Please refer to Note V. 11 for details of the Company’s determination method and accounting treatment method of expected credit losses on contract assets.

Contract assets and contract liabilities are presented separately in the balance sheet. Contract assets and contract liabilities under the same contract are listed in a net amount. If the net amount is a debit balance, it is listed in the "contract assets" or "other non-current assets" item according to its liquidity; if the net amount is a credit balance, it is listed in the "contract liabilities" or "other non-current liabilities" item based on its liquidity. Contract assets and contract liabilities under different contracts cannot be offset against each other.

17. Inventory

(1) Classification of inventory

Inventories refer to the finished products or commodities held by the company for sale in daily activities, products in progress during the production process, materials and supplies consumed in the production process or the provision of labor services, including raw materials, commissioned processing materials, semi-finished products, goods in stock, goods shipped, etc.

(2) Valuation method for issued inventory

The Company's inventories are valued using the weighted average method when shipped.

(3) Inventory inventory system

The company's inventory adopts a perpetual inventory system, which is counted at least once a year, and the amount of inventory gain and loss is included in the current year's profit and loss.

(4) Recognition standards and accrual methods for inventory depreciation provisions

On the balance sheet date, it is measured at the lower of cost and net realizable value. If the inventory cost is higher than its net realizable value, a provision for inventory depreciation is made and included in the current profit and loss. When determining the net realizable value of inventory, it is based on the reliable evidence obtained and factors such as the purpose of holding the inventory and the impact of events after the balance sheet date are considered.

① For inventories that are directly for sale, such as finished products, commodities and materials for sale, during the normal production and operation process, the net realizable value is determined by the estimated selling price of the inventory minus the estimated sales expenses and related taxes. For inventories held for the execution of a sales contract or a service contract, the contract price is used as the measurement basis for its net realizable value; if the quantity of inventory held is greater than the quantity ordered in the sales contract, the excess net realizable value of the inventory is measured based on the general sales price. For materials used for sale, the market price is used as the measurement basis of their net realizable value.

② For materials inventories that need to be processed, in the normal production and operation process, the net realizable value is determined by the estimated selling price of the finished products minus the estimated costs to be incurred upon completion, estimated sales expenses and related taxes. If the net realizable value of the finished product produced is higher than the cost, the material is measured at cost; if the drop in material price indicates that the net realizable value of the finished product is lower than the cost, the material is measured at net realizable value, and inventory depreciation provisions are made based on the difference.

③The company generally accrues inventory depreciation provisions based on individual inventory items; for inventories with large quantities and low unit prices, accrual is based on inventory categories.

④ On the balance sheet date, if the factors that caused the previous write-down of the inventory value have disappeared, the amount of the write-down will be restored and reversed within the amount of the inventory depreciation provision that was originally accrued, and the reversed amount will be included in the current profit and loss.

(5) Amortization method of turnover materials

①Amortization method for low-value consumables: The one-time write-off method is adopted when they are used.

②Amortization method of packaging materials: The one-time write-off method is adopted when receiving the goods.

18. Debt investment

See Note 5.11 for details.

19. Other debt investments

See Note 5.11 for details.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

20. Long-term receivables

See Note 5.11 for details.

21. Long-term equity investment

The Company's long-term equity investments include equity investments that control and have significant influence on the invested units, as well as equity investments in joint ventures. If the company can exert significant influence on the invested unit, it is an associate of the company.

(1) Basis for determining joint control and significant influence on the invested unit

Joint control refers to the shared control over an arrangement in accordance with relevant agreements, and the relevant activities of the arrangement must be decided only with the unanimous consent of the parties sharing control rights. When determining whether joint control exists, first determine whether all participants or a combination of participants collectively control the arrangement. If all participants or a group of participants must act in concert to decide on the relevant activities of an arrangement, then all participants or a group of participants are deemed to collectively control the arrangement. Next, determine whether decisions on activities related to the arrangement must be unanimously agreed upon by the participants who collectively control the arrangement. If a combination of two or more parties can collectively control an arrangement, it does not constitute joint control. When determining whether joint control exists, the protective rights enjoyed are not taken into account.

Significant influence means that the investor has the power to participate in decision-making on the financial and operating policies of the invested unit, but it is not able to control or jointly control the formulation of these policies with other parties. When determining whether it can exert significant influence on the invested unit, the investor's direct or indirect holding of voting shares of the invested unit and the impact of the current executable potential voting rights held by the investor and other parties are assumed to be converted into equity in the invested unit, including the impact of current convertible warrants, share options and convertible corporate bonds issued by the invested unit.

When the company directly or indirectly through subsidiaries owns more than 20% (including 20%) but less than 50% of the voting shares of the invested unit, it is generally considered to have a significant impact on the invested unit. Unless there is clear evidence that it cannot participate in the production and operation decisions of the invested unit under such circumstances, it will not have a significant impact.

(2) Determination of initial investment cost

① The investment cost of long-term equity investment formed by enterprise merger shall be determined in accordance with the following provisions:

A. For business mergers under the same control, if the merging party pays cash, transfers non-cash assets or assumes debts as the merger consideration, the share of the book value of the owner's equity of the merged party in the final controlling party's consolidated financial statements on the merger date shall be used as the initial investment cost of the long-term equity investment. The difference between the initial investment cost of long-term equity investment and the cash paid, non-cash assets transferred and the book value of debts assumed shall be adjusted to the capital reserve; if the capital reserve is insufficient for offset, the retained earnings shall be adjusted;

B. In the merger of enterprises under the same control, if the merging party issues equity securities as the merger consideration, the share of the book value of the merged party's owner's equity in the final controlling party's consolidated financial statements on the merger date shall be used as the initial investment cost of the long-term equity investment. The total face value of the shares issued is taken as share capital. The difference between the initial investment cost of the long-term equity investment and the total face value of the shares issued is adjusted to the capital reserve; if the capital reserve is insufficient for offset, the retained earnings are adjusted;

C. For business mergers not under the same control, the fair value of the assets paid, liabilities incurred or assumed, and equity securities issued on the acquisition date to obtain control of the purchased party is determined as the merger cost as the initial investment cost of the long-term equity investment. The merging party's intermediary fees such as auditing, legal services, evaluation and consulting, and other related management expenses incurred by the business merger shall be included in the current profit and loss when incurred.

②Except for long-term equity investments formed through business mergers, the investment cost of long-term equity investments obtained through other means shall be determined in accordance with the following provisions:

A. For long-term equity investments obtained by paying cash, the investment cost shall be based on the actual purchase price paid. Initial investment costs include fees, taxes and other necessary expenses directly related to obtaining long-term equity investment;

B. For long-term equity investments obtained by issuing equity securities, the initial investment cost shall be the fair value of the equity securities issued;

C. For long-term equity investments obtained through the exchange of non-monetary assets, if the exchange has commercial substance and the fair value of the assets exchanged or exchanged out can be measured reliably, the fair value of the assets exchanged out and related taxes and fees will be used as the initial investment cost, and the difference between the fair value and book value of the assets exchanged out will be included in the current profit and loss; if the exchange of non-monetary assets does not meet the above two conditions at the same time, the book value of the assets exchanged out and related taxes and fees will be used as the initial investment cost.

D. For long-term equity investments obtained through debt restructuring, the book value is determined based on the fair value of the relinquished claims and taxes and other costs directly attributable to the asset, and the difference between the fair value of the relinquished claims and the book value is included in the current profit and loss.

(3) Subsequent measurement and profit and loss recognition methods

The long-term equity investment that the company can control over the investee is accounted for using the cost method; the long-term equity investment in associates and joint ventures is accounted for using the equity method.

①Cost method

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

For long-term equity investments accounted for using the cost method, the cost of the long-term equity investment is adjusted when the investment is added or recovered; cash dividends or profits declared by the investee to be distributed are recognized as investment income for the current period.

②Equity method

For long-term equity investments accounted for using the equity method, the general accounting treatment is:

If the investment cost of the company's long-term equity investment is greater than the fair value share of the investee's identifiable net assets at the time of investment, the initial investment cost of the long-term equity investment will not be adjusted; if the initial investment cost of the long-term equity investment is less than the fair value share of the investee's identifiable net assets at the time of investment, the difference will be included in the current profit and loss, and the cost of the long-term equity investment will be adjusted at the same time.

The company recognizes investment income and other comprehensive income respectively according to its share of the net profit or loss and other comprehensive income realized by the invested unit, and adjusts the book value of the long-term equity investment at the same time; the company calculates its share of the profits or cash dividends declared by the invested unit, and accordingly reduces the book value of the long-term equity investment; for other changes in the owner's equity of the invested unit other than net profits and losses, other comprehensive income and profit distribution, the company adjusts the book value of the long-term equity investment and includes it in the owner's equity. When confirming the share of the investee's net profits and losses, the net profit of the investee is adjusted and recognized based on the fair value of the investee's identifiable net assets when the investment is obtained. If the accounting policies and accounting periods adopted by the invested unit are inconsistent with those of the Company, the financial statements of the invested unit shall be adjusted in accordance with the Company's accounting policies and accounting periods, and investment income and other comprehensive income shall be recognized accordingly. Unrealized gains and losses from internal transactions between the Company and its associates and joint ventures are offset based on the proportion attributable to the Company, and investment gains and losses are recognized on this basis. If the unrealized internal transaction losses between the company and the investee belong to asset impairment losses, they should be recognized in full.

If the investee can exert significant influence or implement joint control due to additional investment or other reasons but does not constitute control, the sum of the fair value of the original equity investment plus the cost of the new investment shall be used as the initial investment cost to be calculated according to the equity method. If the equity investment originally held is classified as other equity instrument investment, the difference between its fair value and book value, as well as the accumulated gains or losses originally included in other comprehensive income, shall be transferred out of other comprehensive income in the current period when it is calculated according to the equity method and included in retained earnings.

If joint control or significant influence over the invested unit is lost due to disposal of part of the equity investment or other reasons, the remaining equity after disposal shall be measured at fair value, and the difference between its fair value and book value on the date of loss of joint control or significant influence shall be included in the current profit and loss. Other comprehensive income recognized as a result of the original equity investment being accounted for using the equity method will be accounted for on the same basis as if the investee directly disposed of relevant assets or liabilities when the equity method is terminated. (4) Impairment testing method and impairment provision accrual method

For investments in subsidiaries, associates and joint ventures, please refer to Note V. 27 for details on the method of accruing asset impairment.

22. Investment real estate

Investment real estate measurement model

Cost method measurement

Depreciation or amortization method

(1) Classification of investment real estate

Investment property is property held to earn rentals or for capital appreciation, or both. Mainly include:

①Leased land use rights.

② Land use rights held and prepared to be transferred after appreciation.

③ Buildings that have been leased.

(2) Measurement model of investment real estate

The company adopts the cost model for subsequent measurement of investment real estate. Please refer to Note V. 27 for the method of accruing asset impairment.

The company calculates depreciation or amortization based on the straight-line method after deducting accumulated impairment and net residual value from the cost of investment real estate. The depreciation period and annual depreciation rate are determined based on the category of investment real estate, the estimated economic useful life and the estimated net residual value rate as follows:

Category Depreciation life Salvage value rate Annual depreciation rate

Houses and buildings 20 years 5.00% 4.75% Land use rights 50 years - 2.00%

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

23. Fixed assets

(1) Confirmation conditions

When fixed assets meet the following conditions at the same time, they shall be recognized at the actual cost when acquired:

①The economic benefits related to the fixed asset are likely to flow into the enterprise.

②The cost of the fixed asset can be measured reliably.

Subsequent expenditures incurred on fixed assets that meet the fixed asset recognition conditions are included in the cost of the fixed assets; those that do not meet the fixed asset recognition conditions are included in the current profit and loss when incurred.

(2) Depreciation method

Category Depreciation method Depreciation period Residual value rate Annual depreciation rate Houses and buildings Year-averaged method 20 years 5.00% 4.75%

Machinery and equipment Average age method 3 years-10 years 5.00% 9.50%-31.67% Transportation equipment Average age method 4 years 5.00% 23.75%

Tools and equipment Straight-line method 3 years to 5 years 5.00% 19.00%-31.67% Electronic equipment and others Straight-line method 3 years to 5 years 5.00% 19.00%-31.67% For fixed assets for which impairment provisions have been made, the provision for fixed assets impairment is deducted when depreciation is made.

At the end of each year, the company reviews the useful life, estimated net residual value and depreciation method of fixed assets. If the estimated service life is different from the original estimate, the service life of the fixed assets shall be adjusted.

24. Projects under construction

(1) Construction in progress is classified and accounted for by approved projects.

(2) Standards and timing for transferring projects under construction into fixed assets

For projects under construction, all expenditures incurred before the asset reaches its intended usable state shall be regarded as the recorded value of the fixed assets. Including construction costs, the original price of machinery and equipment, other necessary expenditures incurred to bring the project under construction to its intended usable state, as well as the borrowing costs incurred for special borrowing for the project before the asset reaches its intended usable state and the borrowing costs incurred for general borrowings occupied. The company will transfer the construction in progress to fixed assets when the project installation or construction is completed and reaches the intended usable state. Fixed assets that have been constructed and have reached the intended usable state but have not yet processed the final settlement of completion will be transferred to fixed assets at an estimated value based on the project budget, cost or actual cost of the project from the date they reach the intended usable state, and depreciation of the fixed assets will be accrued in accordance with the company's fixed asset depreciation policy. After the final settlement of completion has been processed, the original estimated value will be adjusted based on the actual cost, but the originally accrued depreciation amount will not be adjusted.

The specific standards and time points for the consolidation of various types of projects under construction of the Company:

Category Consolidation Criteria and Time Point

(1) The main construction project and supporting projects have been substantially completed; (2) The construction project has reached the predetermined design requirements, and after survey and design

(3) Acceptance by external departments such as fire protection, land and planning, etc.; (4) The construction project reaches the level of houses and buildings

If the project reaches the scheduled usable state but has not yet processed the final accounts for completion, it will be transferred to fixed assets at the estimated value based on the actual cost of the project from the date it reaches the scheduled usable state.

(1) Relevant equipment and other supporting facilities have been installed; (2) After debugging, the equipment can maintain normal and stable operation for a period of time; (3) The production equipment can stably produce qualified products for a period of time; (4) The equipment has been used by asset managers and users

Personnel acceptance.

25. Borrowing costs

(1) Recognition principles and capitalization period of capitalization of borrowing costs

The borrowing costs incurred by the Company that are directly attributable to the acquisition, construction or production of assets that meet the capitalization conditions will be capitalized and included in the cost of the relevant assets when the following conditions are met at the same time:

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

① Asset expenditure has occurred;

②The borrowing costs have been incurred;

③The necessary purchase, construction or production activities to bring the asset to its intended usable state have begun.

Other borrowing interests, discounts or premiums and exchange differences are included in the profits and losses of the current period.

If an asset that meets the capitalization conditions is abnormally interrupted during the acquisition, construction or production process, and the interruption lasts for more than 3 months, the capitalization of borrowing costs will be suspended.

When the acquisition, construction or production of assets that meet the capitalization conditions reaches the intended usable or salable state, the capitalization of borrowing costs will be stopped; subsequent borrowing costs will be recognized as expenses in the current period in which they are incurred.

(2) Calculation method of capitalization rate of borrowing costs and capitalization amount

If a special loan is borrowed for the purpose of purchasing, constructing or producing assets that meet the capitalization conditions, the capitalized amount of the special borrowing interest fee shall be determined as the amount of interest expense actually incurred on the special borrowing in the current period, minus the interest income obtained from depositing the unused borrowed funds in the bank or the investment income obtained from temporary investment.

If general borrowings are occupied by the acquisition, construction or production of assets that meet the capitalization conditions, the amount of interest that should be capitalized on the general borrowings shall be calculated and determined based on the weighted average of the asset disbursements that exceed the part of the special borrowings multiplied by the capitalization rate of the occupied general borrowings. The capitalization rate is calculated and determined based on the weighted average interest rate of general borrowings.

26. Intangible assets

(1) Useful life and its basis for determination, estimation, amortization method or review procedure

(1) Valuation method of intangible assets

Recorded at actual cost when acquired.

(2) Useful life and amortization of intangible assets

① Estimation of useful life of intangible assets with limited service life:

Item Estimated service life Basis

Land use rights 30-50 years Legal use rights

Software 5-10 years Determine the service life with reference to the period that can bring economic benefits to the company

Patent right: 10 years. The service life is determined by reference to the period that can bring economic benefits to the company.

Non-patented technology 10 years. The service life is determined by reference to the period that can bring economic benefits to the company.

At the end of each year, the company reviews the service life and amortization method of intangible assets with limited service life. After review, the useful life and amortization method of the intangible assets at the end of the current period are no different from previous estimates.

② If it is impossible to predict the period during which an intangible asset will bring economic benefits to the enterprise, it shall be regarded as an intangible asset with an indefinite useful life. For intangible assets with uncertain useful lives, the company will review the useful lives of intangible assets with uncertain useful lives at the end of each year. If the useful lives of intangible assets with uncertain useful lives are still uncertain after re-review, an impairment test will be conducted on the balance sheet date.

③Amortization of intangible assets

For intangible assets with limited service life, the company determines its service life when it acquires it, and uses the straight-line method to rationally amortize it within the service life. The amortization amount is included in the current profit and loss according to the benefit items or included in the cost of related assets. The specific amount that should be amortized is the amount after deducting the estimated residual value from the cost. For intangible assets for which impairment provisions have been made, the cumulative amount of impairment provisions for intangible assets that have been made shall be deducted. The residual value of an intangible asset with a limited useful life is deemed to be zero, except in the following circumstances: a third party has committed to purchase the intangible asset at the end of its useful life or the estimated residual value information can be obtained based on an active market, and the market is likely to exist at the end of the intangible asset's useful life.

Intangible assets with indefinite useful lives are not amortized. The service life of intangible assets with indefinite service life is reviewed at the end of each year. If there is evidence that the service life of the intangible asset is limited, its service life is estimated and amortized systematically and reasonably within the expected service life.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

(2) Scope of aggregation of R&D expenditures and related accounting treatment methods

The company classifies various expenses directly related to the development of R&D activities as R&D expenditures, including employee salaries of R&D personnel, design and development fees, direct investment, testing and certification fees, asset depreciation and amortization fees, share-based payment, other expenses, etc.

(1) Specific standards for dividing the research stage and development stage of internal research and development projects

① The company regards the preparation of information and related aspects for further development activities as the research stage. Expenditures in the research stage of intangible assets are included in the current profit and loss when incurred.

② Development activities carried out after the company has completed the research phase are regarded as the development phase.

(2) Specific conditions for capitalization of expenditures during the development phase

Expenditures in the development stage can be recognized as intangible assets only when they meet the following conditions:

A. It is technically feasible to complete the intangible asset so that it can be used or sold;

B. Have the intention to complete the intangible asset and use or sell it;

C. The way intangible assets generate economic benefits includes being able to prove that there is a market for the products produced using the intangible assets or that the intangible assets themselves have a market. If the intangible assets will be used internally, their usefulness can be proven;

D. Have sufficient technical, financial and other resource support to complete the development of the intangible asset, and have the ability to use or sell the intangible asset;

E. The expenditures attributable to the development stage of the intangible asset can be measured reliably.

27. Impairment of long-term assets

The asset impairment of subsidiaries, investment real estate, fixed assets, projects under construction, right-of-use assets, intangible assets, etc. that are subsequently measured using the cost model (except inventories, investment real estate measured using the fair value model, deferred income tax assets, and financial assets) shall be determined according to the following method:

On the balance sheet date, it is judged whether there are any signs that the asset may be impaired. If there are signs of impairment, the company will estimate its recoverable amount and conduct an impairment test. Goodwill formed due to business mergers, intangible assets with indefinite useful lives and intangible assets that have not yet reached a usable state are subject to impairment testing every year regardless of whether there are signs of impairment.

The recoverable amount is determined based on the higher of the asset's fair value less disposal costs and the present value of the asset's expected future cash flows. The Company estimates the recoverable amount on the basis of a single asset; if it is difficult to estimate the recoverable amount of an individual asset, the recoverable amount of the asset group to which the asset belongs is determined based on the asset group. The identification of an asset group is based on whether the main cash inflow generated by the asset group is independent of the cash inflows of other assets or asset groups. When the recoverable amount of an asset or asset group is lower than its book value, the company will write down its book value to the recoverable amount, and the amount of the write-down will be included in the current profit and loss, and the corresponding asset impairment provision will be made.

As far as the impairment test of goodwill is concerned, the book value of goodwill formed due to a business combination shall be allocated to the relevant asset groups in a reasonable manner from the date of purchase; if it is difficult to allocate it to the relevant asset groups, it shall be allocated to the relevant asset group combinations. The relevant asset group or asset group combination is an asset group or asset group combination that can benefit from the synergistic effects of the business combination, and is no larger than the reporting segment determined by the company.

During impairment testing, if there are signs of impairment in an asset group or combination of asset groups related to goodwill, first conduct an impairment test on the asset group or combination of asset groups that does not include goodwill, calculate the recoverable amount, and recognize the corresponding impairment loss. Then conduct an impairment test on the asset group or asset group combination containing goodwill, and compare its book value with the recoverable amount. If the recoverable amount is lower than the book value, the impairment loss of goodwill is recognized.

Once the asset impairment loss is recognized, it will not be reversed in subsequent accounting periods.

28. Long-term deferred expenses

Long-term deferred expenses are calculated as various expenses that have been incurred by the company but should be borne by the current and subsequent periods with an amortization period of more than one year.

The long-term deferred expenses incurred by the company are measured at actual costs and amortized evenly over the expected benefit period. For long-term deferred expense items that cannot benefit future accounting periods, their amortized value shall be fully included in the current profit and loss.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

29. Contract liabilities

See Note 5.16 for details.

30. Employee compensation

(1) Accounting treatment method for short-term compensation

①Basic salary of employees (wages, bonuses, allowances, subsidies)

During the accounting period when employees provide services to them, the Company recognizes actual short-term remuneration as a liability and includes it in the current profit and loss, unless other accounting standards require or allow it to be included in the cost of assets.

②Employee welfare fees

The employee welfare expenses incurred by the company are included in the current profit and loss or related asset costs according to the actual amount when they are actually incurred. If employee benefits are non-monetary benefits, they are measured at fair value.

③Medical insurance premiums, work-related injury insurance premiums, maternity insurance premiums and other social insurance premiums and housing provident funds, as well as trade union funds and employee education funds

The company pays social insurance premiums such as medical insurance premiums, work-related injury insurance premiums, maternity insurance premiums, and housing provident funds for its employees, as well as labor union funds and employee education funds withdrawn in accordance with regulations. During the accounting period when employees provide services to them, the corresponding amount of employee compensation is calculated and determined based on the prescribed accrual basis and accrual ratio, and the corresponding liabilities are recognized and included in the current profit and loss or related asset costs.

④Short-term paid absence from work

When employees provide services that increase their future paid absence rights, the company recognizes employee benefits related to accumulated paid absences and measures them based on the expected increase in payment amount due to accumulated unexercised rights. The Company recognizes employee benefits related to non-cumulative paid absences during the accounting period in which employees are actually absent. ⑤Short-term profit sharing plan

If the profit sharing plan meets the following conditions at the same time, the company will confirm the relevant employee benefits payable:

A. The enterprise now has a legal obligation or constructive obligation to pay employee remuneration due to past events;

B. The amount of employee compensation obligations payable due to the profit sharing plan can be estimated reliably.

(2) Accounting treatment of post-employment benefits

① Set up a withdrawal plan

During the accounting period when employees provide services to them, the company recognizes the deposit amount payable calculated according to the defined contribution plan as a liability and includes it in the current profit and loss or related asset costs.

According to the defined contribution plan, if the entire amount of deposits payable is not expected to be paid within twelve months after the end of the annual reporting period in which employees provide relevant services, the company shall refer to the corresponding discount rate (determined based on the market rate of return of treasury bonds or high-quality corporate bonds in the active market that match the obligation period and currency of the defined contribution plan on the balance sheet date), and measure the entire amount of deposits payable at the discounted amount.

②Defined benefit plan

A. Determine the present value of defined benefit plan obligations and current service costs

According to the expected cumulative benefit unit method, unbiased and mutually consistent actuarial assumptions are used to estimate relevant demographic variables and financial variables, measure the obligations arising from the defined benefit plan, and determine the vesting period of the relevant obligations. The Company discounts the obligations arising from the defined benefit plan at the corresponding discount rate (determined based on the market yield of treasury bonds or high-quality corporate bonds in the active market that match the obligation term and currency of the defined benefit plan on the balance sheet date) to determine the present value of the defined benefit plan obligations and the current service cost.

B. Confirm the net liabilities or net assets of the defined benefit plan

If there are assets in the defined benefit plan, the company will recognize the deficit or surplus formed by the present value of the defined benefit plan obligations minus the fair value of the defined benefit plan assets as the net liability or net assets of a defined benefit plan.

If there is a surplus in the defined benefit plan, the company shall measure the net assets of the defined benefit plan at the lower of the surplus of the defined benefit plan and the upper asset limit. C. Determine the amount that should be included in the asset cost or current profit and loss

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Service costs include current service costs, past service costs and settlement gains or losses. Among them, except for current service costs that are required or allowed to be included in asset costs by other accounting standards, other service costs are included in current profits and losses.

The net interest on the net liabilities or net assets of a defined benefit plan, including interest income on plan assets, interest expenses on defined benefit plan obligations, and interest affected by the asset ceiling, are all included in the current profit and loss.

D. Determine the amount that should be included in other comprehensive income

Changes resulting from remeasurement of the net liabilities or net assets of the defined benefit plan include:

(a) Actuarial gain or loss, which is the increase or decrease in the present value of previously measured defined benefit plan obligations due to actuarial assumptions and experience adjustments; (b) return on plan assets, net of the amount included in the net interest on the net liabilities or net assets of the defined benefit plan;

(c) Changes affecting the asset cap, less the amount included in the net interest on the net liabilities or net assets of the defined benefit plan.

The changes resulting from the above-mentioned remeasurement of the net liabilities or net assets of the defined benefit plan are directly included in other comprehensive income, and are not allowed to be transferred back to profit and loss in subsequent accounting periods. When the original defined benefit plan is terminated, the company will carry forward all the parts originally included in other comprehensive income to undistributed profits within the scope of equity.

(3) Accounting treatment method for dismissal benefits

If the company provides dismissal benefits to employees, the employee compensation liabilities arising from the dismissal benefits will be recognized at the earliest of the following two times and included in the current profit and loss: ① When the enterprise cannot unilaterally withdraw the dismissal benefits provided due to the labor relationship termination plan or layoff proposal;

② When the enterprise confirms the costs or expenses related to the restructuring involving the payment of termination benefits.

If the dismissal benefit is not expected to be fully paid within twelve months after the end of the annual reporting period, the dismissal benefit amount will be discounted with reference to the corresponding discount rate (determined based on the market yield of treasury bonds or high-quality corporate bonds in the active market that match the obligation period and currency of the defined benefit plan on the balance sheet date), and the employee benefits payable will be measured at the discounted amount.

(4) Accounting treatment methods for other long-term employee benefits

①Those who meet the conditions of the defined contribution plan

If the company provides other long-term employee benefits to employees that meet the conditions of the defined contribution plan, the entire payable deposit amount will be measured as the discounted amount of employee benefits payable.

②Meet the conditions for defined benefit plan

At the end of the reporting period, the company recognizes employee compensation costs arising from other long-term employee benefits as the following components:

A. Service cost;

B. Net interest on other long-term employee benefits net liabilities or net assets;

C. Changes caused by re-measurement of other long-term employee benefits net liabilities or net assets.

In order to simplify the relevant accounting treatment, the total net amount of the above items is included in the current profit and loss or related asset costs.

31. Estimated liabilities

(1) Recognition standards for estimated liabilities

If the obligations related to contingencies meet the following conditions at the same time, the company will recognize them as estimated liabilities:

①The obligation is the current obligation of the company;

②The performance of this obligation is likely to result in the outflow of economic benefits from the company;

③The amount of the obligation can be measured reliably.

(2) Measurement method of estimated liabilities

Estimated liabilities are initially measured based on the best estimate of the expenditure required to fulfill the relevant current obligations, and factors such as risks, uncertainties, and time value of money related to contingencies are comprehensively considered. The book value of estimated liabilities is reviewed on each balance sheet date. If there is conclusive evidence that the book value cannot reflect the current best estimate, the book value will be adjusted based on the current best estimate.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

32. Share-based payment

(1) Types of share-based payment

The Company's share-based payment includes cash-settled share-based payment and equity-settled share-based payment.

(2) Method for determining the fair value of equity instruments

① For shares granted to employees, their fair value is measured based on the market price of the company's shares, and adjusted by taking into account the terms and conditions on which the shares are granted (excluding vesting conditions other than market conditions). ② For stock options granted to employees, in many cases it is difficult to obtain the market price. If no trading options exist with similar terms and conditions, the Company selects an applicable option pricing model to estimate the fair value of the options granted.

(3) Basis for confirming the best estimate of exercisable equity instruments

On each balance sheet date during the waiting period, the company makes its best estimate based on the latest changes in the number of vested employees and other subsequent information, and corrects the number of equity instruments expected to be vested to make the best estimate of the vested equity instruments.

(4) Accounting treatment for the implementation of share-based payment plans

cash-settled share-based payment

① For cash-settled share-based payments that become exercisable immediately after grant, the fair value of the liability assumed by the company on the grant date will be included in the relevant costs or expenses, and the liability will increase accordingly. The fair value of the liability is remeasured on each balance sheet date and settlement date before settlement, and the changes are included in profit and loss.

② For cash-settled share-based payments that are exercisable only after the services within the waiting period are completed or the specified performance conditions are met, on each balance sheet date during the waiting period, based on the best estimate of the vesting situation and the fair value of the liability borne by the company, the services obtained in the current period are included in costs or expenses and corresponding liabilities.

Equity-settled share-based payment

① Equity-settled share-based payments that are exercisable immediately after grant in exchange for employee services will be included in the relevant costs or expenses at the fair value of the equity instrument on the date of grant, and the capital reserve will be increased accordingly.

② For equity-settled share-based payments that are exercisable in exchange for employee services after completing services within the waiting period or reaching specified performance conditions, on each balance sheet date during the waiting period, based on the best estimate of the number of exercisable equity instruments and the fair value on the date of grant of the equity instrument, the services obtained in the current period are included in costs or expenses and capital reserves.

(5) Accounting treatment for modifications to share-based payment plans

When the company modifies the share-based payment plan, if the modification increases the fair value of the equity instruments granted, the increase in services obtained shall be recognized accordingly according to the increase in the fair value of the equity instruments; if the modification increases the number of equity instruments granted, the fair value of the increased equity instruments shall be recognized accordingly as an increase in services obtained. The increase in the fair value of equity instruments refers to the difference between the fair values ​​of the equity instruments before and after the modification on the modification date. If the modification reduces the total fair value of the share-based payment or modifies the terms and conditions of the share-based payment plan in other ways that are unfavorable to employees, the accounting treatment for the services obtained will continue, as if the change has never occurred, unless the company cancels some or all of the equity instruments that have been granted.

(6) Accounting treatment for termination of share-based payment plan

If the granted equity instruments are canceled or settled during the waiting period (except those canceled due to failure to meet vesting conditions), the company:

① Treat cancellation or settlement as accelerated vesting, and immediately confirm the amount that should have been confirmed within the remaining waiting period;

② All payments to employees upon cancellation or settlement are treated as equity repurchases. The amount paid for repurchase that is higher than the fair value of the equity instrument on the repurchase date shall be included in the current expenses.

If the company repurchases an equity instrument that has been exercised by its employees, it will offset the owner's equity of the enterprise; the part of the repurchase payment that is higher than the fair value of the equity instrument on the repurchase date shall be included in the current profit and loss.

33. Income

Disclose accounting policies adopted for revenue recognition and measurement by business type

(1) General principles

Income is the total inflow of economic benefits generated by the company in its daily activities that will lead to an increase in shareholders' equity and have nothing to do with the capital invested by shareholders.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

The company fulfills its performance obligations in the contract, that is, when the customer obtains control of the relevant goods, revenue is recognized. Obtaining control over relevant goods means being able to direct the use of the goods and obtain almost all economic benefits from them.

If the contract contains two or more performance obligations, the Company will allocate the transaction price to each individual performance obligation based on the relative proportion of the stand-alone selling price of the goods or services promised by each individual performance obligation on the contract commencement date, and measure revenue based on the transaction price allocated to each individual performance obligation.

The transaction price is the amount of consideration that the Company expects to be entitled to receive for transferring goods or services to the customer, excluding payments received on behalf of third parties. When determining the contract transaction price, if there is variable consideration, the company determines the best estimate of the variable consideration based on the expected value or the most likely amount, and includes it in the transaction price at an amount that does not exceed the amount that is unlikely to significantly reverse the cumulative recognized revenue when the relevant uncertainty is eliminated. If there is a significant financing component in the contract, the company will determine the transaction price based on the amount payable in cash by the customer when it obtains control of the product. The difference between the transaction price and the contract consideration will be amortized using the effective interest method during the contract period. If the interval between the transfer of control and the customer's payment does not exceed one year, the company will not consider the financing component. If one of the following conditions is met, the performance obligation is performed within a certain period of time; otherwise, the performance obligation is performed at a certain point in time:

① When the company performs the contract, the customer obtains and consumes the economic benefits brought by the company's performance;

②The customer can control the goods under construction during the company's performance of the contract;

③The goods produced by the company during the performance of the contract have irreplaceable uses, and the company has the right to collect payment for the cumulative performance part that has been completed so far during the entire contract period.

For performance obligations performed within a certain period of time, the Company will recognize revenue based on the performance progress during that period, except where the performance progress cannot be reasonably determined. The Company determines the performance progress of services provided according to the input method (or output method). When the progress of contract performance cannot be reasonably determined, if the costs incurred by the company are expected to be compensated, revenue will be recognized based on the amount of costs incurred until the progress of contract performance can be reasonably determined.

For performance obligations fulfilled at a certain point in time, the Company recognizes revenue at the point when the customer obtains control of the relevant goods. When judging whether the customer has obtained control of the goods or services, the company will consider the following signs:

① The company has the current right to receive payment for the goods or services, that is, the customer has current payment obligations for the goods;

② The company has transferred the legal ownership of the product to the customer, which means the customer already has the legal ownership of the product;

③The company has transferred the physical goods of the goods to the customer, that is, the customer has physical possession of the goods;

④ The company has transferred the main risks and rewards of ownership of the commodity to the customer, that is, the customer has obtained the main risks and rewards of ownership of the commodity; ⑤ The customer has accepted the commodity.

Sales return terms

For sales with a sales return clause, when the customer obtains control of the relevant goods, the company recognizes revenue based on the amount of consideration that the customer is entitled to receive for transferring the goods to the customer, and recognizes the amount expected to be refunded due to sales returns as estimated liabilities; at the same time, the book value of the goods that are expected to be returned at the time of transfer, after deducting the estimated costs of recovering the goods (including the value impairment of the returned goods), is recognized as an asset, that is, the cost of returns receivable. The book value of the transferred goods at the time of transfer, minus the net carry-over cost of the above-mentioned asset costs. On each balance sheet date, the company re-estimates future sales returns and re-measures the above assets and liabilities.

Warranty obligations

In accordance with contract stipulations, legal regulations, etc., the company provides quality assurance for the products sold and the projects constructed. For guarantee-type quality assurance that is used to ensure that the goods sold meet established standards for customers, the Company conducts accounting treatment in accordance with "Accounting Standards for Business Enterprises No. 13 - Contingencies". For service-type quality assurance that provides a separate service to customers in addition to ensuring that the goods sold meet established standards, the company treats it as a single performance obligation and allocates part of the transaction price to the service-type quality assurance based on the relative proportion of the separate selling price of the goods and service-type quality assurance provided, and recognizes revenue when the customer obtains control of the service. When assessing whether a quality guarantee provides a separate service to customers beyond the assurance that the goods sold meet established standards, the Company considers factors such as whether the quality guarantee is a statutory requirement, the duration of the quality guarantee and the nature of the tasks to which the Company undertakes to perform.

Main Responsible Person and Agent

The Company determines whether the Company is the principal or agent when engaging in transactions based on whether it has control over the goods or services before transferring them to the customer. If the company is able to control the goods or services before transferring them to the customer, the company is the primary responsible person and recognizes revenue based on the total amount of consideration received or receivable. Otherwise, the company acts as an agent and recognizes revenue based on the amount of commissions or fees that it is expected to be entitled to receive. This amount should be determined based on the net amount of the total consideration received or receivable after deducting the price payable to other related parties, or based on the established commission amount or ratio.

Consideration payable to customers

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

If there is consideration payable to customers in the contract, unless the consideration is for obtaining other clearly distinguishable goods or services from customers, the company will offset the consideration payable from the transaction price, and offset the current revenue at the later of the recognition of relevant income and the payment (or commitment to pay) of the customer consideration.

Customer’s unexercised contractual rights

If the company receives payment in advance from customers for the sale of goods or services, it will first recognize the payment as a liability and then convert it into revenue when the relevant performance obligations are fulfilled. When the Company's advance receipt does not need to be returned and the customer may give up all or part of its contractual rights, and the Company expects to be entitled to the amount related to the contractual rights given up by the customer, the above amount will be recognized as revenue in proportion according to the customer's mode of exercising the contract rights; otherwise, the Company will only convert the relevant balance of the above liabilities into revenue when the possibility of the customer's request to perform the remaining performance obligations is extremely low.

Contract changes

When the construction contract between the company and the customer is changed:

① If the contract change adds clearly distinguishable construction services and contract prices, and the new contract price reflects the separate selling price of the new construction services, the company will account for the contract change as a separate contract;

② If the contract change does not fall into the above ① situation, and the construction services that have been transferred and the construction services that have not been transferred can be clearly distinguished on the date of contract change, the company will regard it as the termination of the original contract, and at the same time, the unperformed part of the original contract and the changed part of the contract will be combined into a new contract for accounting treatment;

③ If the contract change does not fall into the above ① situation, and the construction services that have been transferred and the construction services that have not been transferred cannot be clearly distinguished on the date of contract change, the company will account for the contract change as an integral part of the original contract. The resulting impact on the recognized revenue will be adjusted to the current revenue on the contract change date.

(2) Specific methods

The specific method of revenue recognition of the Company is as follows:

① Method for recognizing sales revenue of new energy vehicle electric drive systems and related parts and accessories

Domestic sales:

(a) Non-consignment model: The company transports the products to the agreed delivery location in accordance with the contract, and after the buyer confirms receipt, the product sales revenue is recognized;

(b) Consignment model: The company delivers the product to the customer's designated warehouse. After the customer takes the product and confirms the quantity with the customer, the company confirms the revenue based on the corresponding system data and checks the receipt record with the buyer;

(c) Revenue from sales of foreign goods: revenue is recognized in accordance with the terms of trade terms. For sales business using the FOB trade settlement method, the company recognizes revenue in the current period when the product is declared customs and the bill of lading is obtained; for sales business using the EXW trade settlement method, the company recognizes revenue in the current period when the customer or its designated carrier comes to pick up the goods. ② Technology development and service revenue recognition method

Technology development and service revenue includes technology research and development services and extended warranty services.

Technology research and development services: If the company is performing the contract and the customer cannot immediately obtain and consume the economic benefits brought by the company's performance and the company is not entitled to collect payment for the cumulative performance part completed so far during the entire contract period, the company will regard it as a performance obligation to be performed at a certain point in time. When the company completes technical services in accordance with the contract, the company recognizes revenue.

Extended warranty service: When the company performs the contract, the customer obtains and consumes the economic benefits brought by the company's performance. The company treats it as a performance obligation to be performed within a certain period of time. During the period when the extended warranty service is provided, revenue is recognized according to the performance progress.

③Income from transfer of asset use rights

When the economic benefits related to the transaction are likely to flow into the enterprise and the amount of income can be measured reliably, the amount of income from the transfer of the right to use the assets is determined. The company's income from transferring the right to use assets is mainly income from house leasing, which is calculated and determined in accordance with the charging time and method stipulated in the relevant contract or agreement.

Similar business adopts different business models and involves different revenue recognition methods and measurement methods.

34. Contract costs

Contract costs are divided into contract performance costs and contract acquisition costs.

The costs incurred by the company to perform the contract are recognized as an asset as contract performance costs when the following conditions are met at the same time:

① The cost is directly related to a current or expected contract, including direct labor, direct materials, manufacturing overhead (or similar expenses), costs clearly borne by the customer, and other costs incurred solely because of the contract.

② This cost increases the company’s resources for fulfilling its performance obligations in the future.

③The cost is expected to be recovered.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

The incremental costs incurred by the Company to obtain the contract are expected to be recovered and are recognized as an asset as the contract acquisition cost.

Assets related to contract costs are amortized on the same basis as the revenue recognition of goods or services related to the assets; however, if the amortization period of the contract acquisition costs does not exceed one year, the company will include them in the current profits and losses when incurred.

If the book value of assets related to contract costs is higher than the difference between the following two items, the company will make impairment provisions for the excess and recognize it as asset impairment losses, and further consider whether it should accrue estimated liabilities related to loss-making contracts:

①The remaining consideration expected to be obtained from the transfer of goods or services related to the asset;

②The estimated cost to be incurred in transferring the relevant goods or services.

If the above-mentioned asset impairment provision is subsequently reversed, the book value of the asset after the reversal shall not exceed the book value of the asset on the date of reversal if no impairment provision was made.

For contract performance costs recognized as assets, if the amortization period does not exceed one year or one normal operating cycle when initially recognized, they are listed in the "inventory" item. When initially recognized, the amortization period exceeds one year or one normal operating cycle and are listed in the "other non-current assets" item.

For contract acquisition costs recognized as assets, if the amortization period does not exceed one year or one normal operating cycle when initially recognized, they are listed in the "other current assets" item. When initially recognized, the amortization period exceeds one year or one normal operating cycle and are listed in the "other non-current assets" item.

35. Government subsidies

(1) Confirmation of government subsidies

Government subsidies can only be confirmed if they meet the following conditions at the same time:

① The company can meet the conditions attached to the government subsidy;

②The company can receive government subsidies.

(2) Measurement of government subsidies

If government subsidies are monetary assets, they shall be measured based on the amount received or receivable. If the government subsidy is a non-monetary asset, it shall be measured at fair value; if the fair value cannot be obtained reliably, it shall be measured at the nominal amount of 1 yuan.

(3) Accounting treatment of government subsidies

①Government subsidies related to assets

Government subsidies obtained by the company for the purchase, construction or other formation of long-term assets are classified as asset-related government subsidies. Government subsidies related to assets are recognized as deferred income and are included in profits and losses in installments according to a reasonable and systematic method during the use period of the relevant assets. Government subsidies measured according to the nominal amount are directly included in the current profit and loss. If the relevant assets are sold, transferred, scrapped or damaged before the end of their useful life, the undistributed balance of relevant deferred income will be transferred to the profit and loss of the current period of asset disposal.

②Government subsidies related to income

Government subsidies other than asset-related government subsidies are classified as income-related government subsidies. Government subsidies related to income shall be accounted for in accordance with the following provisions on a case-by-case basis:

If it is used to compensate the company for relevant costs or losses in subsequent periods, it will be recognized as deferred income, and will be included in the current profit and loss during the period when the relevant costs or losses are recognized;

If it is used to compensate for the relevant costs or losses incurred by the company, it will be directly included in the current profit and loss.

For government subsidies that contain both asset-related parts and income-related parts, different parts shall be distinguished and accounted for separately; if it is difficult to distinguish, the whole shall be classified as income-related government subsidies.

Government subsidies related to the company's daily activities are included in other income based on the economic and business essence. Government subsidies that are not related to the company's daily activities are included in non-operating income and expenses.

③Policy preferential loan interest discounts

The finance department will allocate interest discount funds to the lending bank, and the lending bank will provide loans to the company at a policy preferential interest rate. The actual loan amount received will be used as the entry value of the loan, and the relevant borrowing costs will be calculated based on the loan principal and the policy preferential interest rate.

The finance department will directly allocate interest discount funds to the company, and the company will use the corresponding interest discount to offset related borrowing costs.

④Refund of government subsidies

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

When a confirmed government subsidy needs to be returned, if the book value of the relevant assets is offset at the time of initial recognition, the book value of the assets is adjusted; if there is a balance of relevant deferred income, the book balance of the relevant deferred income is offset, and the excess is included in the current profit and loss; in other cases, it is directly included in the current profit and loss.

36. Deferred income tax assets/deferred income tax liabilities

The Company usually uses the balance sheet debt method to recognize and measure the impact of taxable temporary differences or deductible temporary differences on income tax as deferred income tax liabilities or deferred income tax assets based on the temporary differences between the book values and tax bases of assets and liabilities on the balance sheet date. The Company does not discount deferred income tax assets and deferred income tax liabilities.

(1) Recognition of deferred income tax assets

For deductible temporary differences, deductible losses and tax credits that can be carried forward to future years, the impact on income tax is calculated based on the income tax rate during the expected reversal period, and the impact is recognized as deferred income tax assets, but only to the extent that the company is likely to obtain future taxable income that can be used to offset the deductible temporary differences, deductible losses and tax credits.

The impact of deductible temporary differences on income tax arising from the initial recognition of assets or liabilities in transactions or events with the following characteristics is not recognized as deferred income tax assets:

A. The transaction is not a business combination;

B. When the transaction occurs, it neither affects accounting profits nor taxable income (or deductible losses).

However, this exemption from the initial recognition of deferred income tax liabilities and deferred income tax assets does not apply to a single transaction that meets the above two conditions at the same time and whose initial recognition of assets and liabilities results in equal amounts of taxable temporary differences and deductible temporary differences. For the taxable temporary differences and deductible temporary differences arising from the initial recognition of assets and liabilities in this transaction, the company recognizes the corresponding deferred income tax liabilities and deferred income tax assets respectively when the transaction occurs.

If the company's deductible temporary differences related to investments in subsidiaries, associates and joint ventures meet the following two conditions, the amount of its impact on income tax will be recognized as deferred income tax assets:

A. The temporary difference is likely to reverse in the foreseeable future;

B. It is likely to obtain taxable income in the future that can be used to offset the deductible temporary differences;

On the balance sheet date, if there is conclusive evidence that sufficient taxable income is likely to be obtained in the future period to offset the deductible temporary differences, deferred income tax assets that have not been recognized in previous periods will be recognized.

On the balance sheet date, the Company reviews the book value of deferred income tax assets. If it is probable that sufficient taxable income will not be available in future periods to offset the benefits of deferred tax assets, the carrying amount of the deferred tax assets will be reduced. The amount of the write-down is reversed when it is probable that sufficient taxable income will be obtained.

(2) Recognition of deferred income tax liabilities

All taxable temporary differences of the Company are measured to have an impact on income tax at the income tax rate expected to be reversed during the period, and the impact is recognized as deferred income tax liabilities, except for the following circumstances:

① The impact on income tax of taxable temporary differences arising from the following transactions or events is not recognized as deferred income tax liabilities:

A. Initial recognition of goodwill;

B. Initial recognition of assets or liabilities arising from a transaction with the following characteristics: the transaction is not a business combination, and when the transaction occurs, it neither affects accounting profits nor taxable income or deductible losses.

② The Company generally recognizes the taxable temporary differences related to investments in subsidiaries, joint ventures and associates, and their impact on income tax as deferred income tax liabilities, unless the following two conditions are met at the same time:

A. The company can control the time when temporary differences are reversed;

B. The temporary difference is likely not to be reversed in the foreseeable future.

(3) Recognition of deferred income tax liabilities or assets involved in specific transactions or events

① Deferred income tax liabilities or assets related to business combinations

For taxable temporary differences or deductible temporary differences arising from business combinations not under common control, while deferred income tax liabilities or deferred income tax assets are recognized, the related deferred income tax expenses (or income) are usually adjusted to the goodwill recognized in the business combination.

② Items directly included in owners’ equity

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Current income taxes and deferred income taxes related to transactions or events that are directly included in owners' equity are included in owners' equity. Transactions or events that have the impact of temporary differences on income tax included in owners' equity include: other comprehensive income resulting from changes in the fair value of other debt investments, changes in accounting policies that adopt the retrospective adjustment method or the correction of differences in previous (important) accounting errors, the retrospective restatement method to adjust opening retained earnings, mixed financial instruments that contain both liability components and equity components are included in owners' equity at the time of initial recognition, etc.

③Can make up for losses and tax deductions

A. Recoverable losses and tax deductions generated by the company’s own operations

Deductible losses refer to losses calculated and determined in accordance with tax laws and allowed to be made up with taxable income in subsequent years. Uncovered losses (deductible losses) and tax credits that can be carried forward to future years in accordance with tax laws are treated as deductible temporary differences. When it is expected that sufficient taxable income will be obtained in the future period in which recoverable losses or tax credits can be utilized, the corresponding deferred income tax assets will be recognized to the extent of the taxable income that is likely to be obtained, and the income tax expense in the current period's income statement will be reduced at the same time.

B. Compensable uncompensated losses of the merged enterprise resulting from business mergers

In a business combination, if the company obtains deductible temporary differences from the purchased party and does not meet the conditions for recognition of deferred income tax assets on the acquisition date, it will not be recognized. Within 12 months after the purchase date, if new or further information is obtained indicating that the relevant circumstances on the purchase date already exist, and the economic benefits brought by the deductible temporary differences of the purchased party are expected to be realized on the purchase date, the relevant deferred income tax assets will be recognized, and the goodwill will be reduced at the same time. If the goodwill is insufficient to offset, the difference will be recognized as current profit and loss; except for the above circumstances, deferred income tax assets related to the business combination will be recognized and included in the current profit and loss.

④Temporary differences resulting from merger elimination

When the company prepares the consolidated financial statements, if there is a temporary difference between the book value of assets and liabilities in the consolidated balance sheet and the tax basis of the tax entity to which it belongs due to offsetting unrealized internal sales gains and losses, deferred income tax assets or deferred income tax liabilities will be recognized in the consolidated balance sheet, and the income tax expenses in the consolidated income statement will be adjusted at the same time, except for deferred income taxes related to transactions or events directly included in owner's equity and business mergers.

⑤ Equity-settled share-based payment

If the tax law stipulates that expenses related to share-based payment are allowed to be deducted before tax, during the period when costs and expenses are recognized in accordance with accounting standards, the company will calculate and determine the tax base and the resulting temporary differences based on the information obtained at the end of the accounting period to estimate the amount that can be deducted before tax. If the recognition conditions are met, the relevant deferred income tax will be recognized. Among them, if the amount that is expected to be deducted before tax in the future exceeds the costs and expenses related to share-based payment recognized in accordance with accounting standards, the excess income tax impact should be directly included in the owner's equity.

(4) Basis for presenting deferred income tax assets and deferred income tax liabilities on a net basis

When the company meets the following conditions at the same time, the deferred income tax assets and deferred income tax liabilities will be presented as the net amount after offsetting:

① The company has the legal right to settle current income tax assets and current income tax liabilities on a net basis;

② Deferred income tax assets and deferred income tax liabilities are related to the income tax levied by the same tax collection and administration department on the same taxable entity or to different taxable entities. However, in each future period when important deferred income tax assets and deferred income tax liabilities are reversed, the taxable entity involved intends to settle the current income tax assets and liabilities with a net amount or to obtain assets and pay off liabilities at the same time.

37. Leasing

(1) Accounting treatment method for leasing as lessee

On the start date of the lease period, the Company identifies leases with a lease term of no more than 12 months and that do not include a purchase option as short-term leases; leases with a low value when a single leased asset is a new asset are identified as low-value asset leases. If the company subleases or anticipates subletting a leased asset, the original lease will not be recognized as a low-value asset lease.

For all short-term leases and low-value asset leases, the Company includes the lease payments into the relevant asset costs or current profits and losses on a straight-line basis during each period of the lease term.

In addition to the above-mentioned short-term leases and low-value asset leases that adopt simplified treatment, the company recognizes right-of-use assets and lease liabilities for leases on the start date of the lease period. ①Right-of-use assets

Right-of-use assets refer to the lessee’s right to use the leased assets during the lease term.

On the commencement date of the lease term, the right-of-use asset is initially measured at cost. This cost includes:

The initial measurement amount of the lease liability;

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

For lease payments paid on or before the start date of the lease period, if there are lease incentives, the amount related to the lease incentives already enjoyed will be deducted;

Initial direct costs incurred by the lessee;

The costs that the lessee expects to incur to dismantle and remove the leased asset, restore the site where the leased asset is located, or restore the leased asset to the state agreed upon in the lease terms. The company recognizes and measures this cost in accordance with the recognition standards and measurement methods of estimated liabilities. Please see Note V. 31 for details. The aforementioned costs incurred for the production of inventory will be included in the inventory cost.

Depreciation of right-of-use assets is calculated using the straight-line method. For those who can reasonably determine that the ownership of the leased asset will be obtained when the lease term expires, the depreciation rate will be determined based on the right-of-use asset category and the expected net residual value rate within the estimated remaining useful life of the leased asset; for those who cannot reasonably be sure that the ownership of the leased asset will be obtained when the lease term expires, the depreciation rate will be determined based on the right-of-use asset category during the shorter of the lease term and the remaining useful life of the leased asset.

②Lease liabilities

Lease liabilities should be initially measured based on the present value of the unpaid lease payments at the beginning of the lease term. The lease payment includes the following five items: fixed payment and substantial fixed payment. If there is a lease incentive, the amount related to the lease incentive will be deducted;

Variable lease payments that depend on an index or rate;

The exercise price of the purchase option if the lessee is reasonably certain that it will exercise the option;

Amounts payable upon exercise of the option to terminate the lease if the lease term reflects the lessee's exercise of the option to terminate the lease;

The amount expected to be paid based on the guaranteed residual value provided by the lessee.

When calculating the present value of lease payments, the interest rate implicit in the lease is used as the discount rate. If the interest rate implicit in the lease cannot be determined, the company's incremental borrowing rate is used as the discount rate. The difference between the lease payment and its present value is regarded as an unrecognized financing expense, and the interest expense is recognized at the discount rate used to confirm the present value of the lease payment during each period of the lease term, and is included in the current profit and loss. Variable lease payments that are not included in the measurement of lease liabilities are included in the current profit and loss when they actually occur.

After the start date of the lease period, when the actual fixed payment amount changes, the expected amount payable of the guaranteed residual value changes, the index or ratio used to determine the lease payment amount changes, the evaluation results or actual exercise of the purchase option, lease renewal option or termination option change, the company remeasures the lease liability according to the present value of the changed lease payment amount, and adjusts the book value of the right-of-use asset accordingly.

(2) Accounting treatment method for leasing as lessor

On the lease commencement date, the Company classifies leases that substantially transfer almost all risks and rewards related to the ownership of the leased assets as finance leases, and other leases as operating leases.

①Operating lease

The company recognizes the lease receipts as rental income according to the straight-line method in each period during the lease period. The initial direct expenses incurred are capitalized and amortized on the same basis as the rental income recognition, and included in the current profit and loss in installments. Variable lease payments obtained by the Company related to operating leases that are not included in the lease receipts are included in the current profit and loss when they actually occur.

②Financial lease

On the start date of the lease, the Company recognizes the financial lease receivables based on the net lease investment (the sum of the unguaranteed residual value and the present value of the lease payments not yet received on the start date of the lease discounted at the interest rate implicit in the lease), and terminates the recognition of financial lease assets. During each period of the lease term, the Company calculates and recognizes interest income based on the interest rate implicit in the lease.

Variable lease payments obtained by the Company that are not included in the measurement of net lease investment are included in the current profit and loss when actually incurred.

38. Changes in important accounting policies and accounting estimates

(1) Changes in important accounting policies

□Applicable Not applicable

(2) Changes in important accounting estimates

□Applicable Not applicable

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

(3) Adjustments to relevant items in the financial statements at the beginning of the year when the new accounting standards are implemented for the first time in 2026.

□Applicable Not applicable

6. Taxes

1. Main tax types and tax rates

Type of tax Tax calculation basis Tax rate

Value-added tax: product, material sales revenue, rental income, etc. 13%, 9%, 7%, 6%

Urban maintenance and construction tax turnover tax 7%, 5%, 3.5%, 2.5%

Corporate income tax: taxable income 25%, 20%, 16.5%, 15%

Education fee surcharge turnover tax 3%, 1.5%

Local education surcharge turnover tax 2%, 1%

Real estate tax: 30% of the original value of the property, 1.2%, 12% for rental income, etc.

Land use tax: Taxable land use area: 3 yuan/square meter, 1.5 yuan/square meter

If there are taxpayers with different corporate income tax rates, a description of the disclosure

Name of tax payer Income tax rate

Wujiang Green Control Electronic Control Technology Co., Ltd. 15%

Suzhou Lvkong New Energy Technology Co., Ltd. 25%

Suzhou Green Control Precision Manufacturing Co., Ltd. 25%

Suzhou Green Control Green Transportation Vehicle Co., Ltd. 20%

Green Control Transmission Technology (Yancheng) Co., Ltd. 25%

Green Control Transmission Technology (Nantong) Co., Ltd. 25%

For the portion of taxable income less than HKD 2 million, 8.25% applies; taxable Green Control Transmission Technology (Hong Kong) Co., Ltd.

For income greater than HKD 2 million, 16.5% applies

Green Control Transmission Technology (Thailand) Co., Ltd. 20%

2. Tax incentives

(1) Value-added tax

According to the provisions of the "Notice of the Ministry of Finance and the State Administration of Taxation on Value-Added Tax Policies for Software Products" (Caishui [2011] No. 100), after the Company's subsidiary Wujiang Green Control Electronic Control Technology Co., Ltd. levies value-added tax on software products that comply with the regulations, the actual tax burden exceeding 3% will be subject to an immediate refund policy.

According to the "Announcement of the Ministry of Finance and the State Administration of Taxation on the Policy for Adding Value-Added Tax Deductions for Advanced Manufacturing Enterprises" (Announcement No. 43 of the Ministry of Finance and the State Administration of Taxation in 2023), from January 1, 2023 to December 31, 2027, the company will deduct an additional 5% of the deductible input tax for the current period to offset the value-added tax payable. The company and its subsidiary Suzhou Lvkong New Energy Technology Co., Ltd. enjoy the additional input tax deduction policy from January to June 2025 and the company from January to June 2026.

(2) Corporate income tax

① The company obtained the "High-tech Enterprise Certificate" issued by the Jiangsu Provincial Department of Science and Technology, the Jiangsu Provincial Department of Finance, and the State Administration of Taxation Jiangsu Provincial Taxation Bureau on December 19, 2025. The certificate number is GR202532007157, which is valid for three years. According to the relevant provisions of the "Enterprise Income Tax Law of the People's Republic of China" and the "Implementation Regulations of the Enterprise Income Tax Law of the People's Republic of China", the company will pay a reduced corporate income tax rate of 15% in 2025, 2026 and 2027.

② The company's subsidiary Wujiang Green Control Electronic Control Technology Co., Ltd. obtained the "High-tech Enterprise Certificate" issued by the Jiangsu Provincial Department of Science and Technology, the Jiangsu Provincial Department of Finance, and the State Administration of Taxation Jiangsu Provincial Taxation Bureau on December 13, 2023. The certificate number is GR202332012945, which is valid for three years. According to the relevant provisions of the "Enterprise Income Tax Law of the People's Republic of China" and the "Regulations on the Implementation of the Enterprise Income Tax Law of the People's Republic of China", Wujiang Green Control Electronic Control Technology Co., Ltd. will pay a reduced corporate income tax rate of 15% in 2023, 2024 and 2025. The high-tech enterprise qualification of Wujiang Green Control Electronic Control Technology Co., Ltd. will be submitted for review in 2026. From January to June 2026, the corporate income tax will be temporarily calculated at a tax rate of 15%.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

③According to the "Announcement on Further Implementing Preferential Income Tax Policies for Small and Micro Enterprises" jointly issued by the Ministry of Finance and the State Administration of Taxation on March 14, 2022 (Announcement No. 13 of the Ministry of Finance and the State Administration of Taxation of 2022), starting from January 2022 From 1st to December 31st, 2025, the annual taxable income of small and low-profit enterprises exceeding 1 million yuan but not exceeding 3 million yuan will be included in the taxable income at a reduced rate of 25%, and the corporate income tax shall be paid at a rate of 20%.

According to the "Announcement on Preferential Income Tax Policies for Small and Micro Enterprises and Individual Industrial and Commercial Households" jointly issued by the Ministry of Finance and the State Administration of Taxation on March 26, 2023 (Announcement No. 6 of the Ministry of Finance and the State Administration of Taxation of 2023), from January 1, 2023 to December 31, 2025, the annual taxable income of small and low-profit enterprises does not exceed 1 million yuan, a reduced rate of 25% will be included in the taxable income, and the corporate income tax will be paid at a rate of 20% . The company's subsidiary Suzhou Green Control Green Capacity Vehicle Co., Ltd. will apply the above preferential policies in 2025.

According to the "Announcement on Relevant Tax Policies to Further Support the Development of Small and Micro Enterprises and Individual Industrial and Commercial Households" jointly issued by the Ministry of Finance and the State Administration of Taxation on August 2, 2023 (Announcement No. 12 of the Ministry of Finance and the State Administration of Taxation, 2023), small and low-profit enterprises will be subject to a 25% reduction in taxable income calculations and a corporate income tax policy of 20%, which will continue until December 31, 2027. The company's subsidiary Suzhou Green Control Green Capacity Vehicle Co., Ltd. will apply the above preferential policies from January to June 2026.

7. Notes on Consolidated Financial Statement Items

1. Monetary funds

Unit: Yuan

Item Ending balance Beginning balance

Cash on hand 24,232.70 19,847.70 Bank deposits 589,736,431.97 261,466,006.70 Other monetary funds 11,063,276.92 14,298,391.56 Total 600,823,941.59 275,784,245.96

2. Notes receivable

(1) Classified presentation of notes receivable

Unit: Yuan

Item Ending balance Beginning balance

Bank acceptance bills 727,894,023.35 546,903,905.31 Commercial acceptance bills 142,500.00 1,067,598.18 Finance company acceptance bills 71,661,543.66 21,608,101.49 Total 799,698,067.01 569,579,604.98

(2) Classified disclosure according to bad debt accrual method

Unit: Yuan Ending balance Beginning balance

Book balance Provision for bad debts Book balance Provision for bad debts

Category Book price Book price provision ratio Provision ratio

Amount Ratio Amount Value Amount Ratio Amount Value Example

its

Medium:

by combination

Bad provision 799,705 7,500.0 799,698 570,183 604,247 569,579

100.00% 100.00% 0.11%

Account provision, 567.01 0, 067.01, 852.80.82, 604.98 receivables

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

bill

its

Medium:

Bank commitments 727,894 727,894 546,903 546,903

91.02% 95.92%

Exchange of bills, 023.35, 023.35, 905.31, 905.31 Financial disclosure

71,661, 71,661, 21,608, 21,608, company acceptance 8.96% 3.79%

543.66 543.66 101.49 101.49 Money order

Commercial contract 150,000 7,500.0 142,500 1,671,8 604,247 1,067,5

0.02% 5.00% 0.29% 36.14%

Exchange draft .00 0 .00 46.00 .82 98.18

799,705 7,500.0 799,698 570,183 604,247 569,579Total 100.00% 0.00% 100.00% 0.11%

,567.01 0 ,067.01 ,852.80 .82 ,604.98 Provision for bad debts by combination Category name: Acceptance bill

Unit: Yuan ending balance

Name

Book balance Bad debt provision Provision ratio

Within 1 year 150,000.00 7,500.00 5.00% 1 to 2 years

2 to 3 years

3 to 4 years

Total 150,000.00 7,500.00

Description of what this combination is based on:

On June 30, 2026, and December 31, 2025, the company will measure the bad debt provisions for notes receivable based on the expected credit losses throughout the duration. The Company believes that the bank acceptance bills and finance company acceptance bills it holds do not have significant credit risks and will not cause significant losses due to default; commercial acceptance bills are measured based on expected credit losses throughout the duration of the commercial acceptance bill bad debt provision.

Please refer to Note V. 11 for details on the recognition standards and explanation of bad debt provision on a group basis.

If bad debt provisions for notes receivable are made according to the general expected credit loss model:

□Applicable Not applicable

(3) Bad debt provisions accrued, recovered or reversed in the current period

Bad debt provisions for the current period:

Unit: Yuan Amount of changes in the current period

Category Beginning Balance Ending Balance

Provision Recovery or transfer Write-off Others

Commercial acceptance bill 604,247.82 596,747.82 7,500.00Total 604,247.82 596,747.82 7,500.00Among them, the amount of recovery or reversal of bad debt provisions in the current period is important:

□Applicable Not applicable

(4) Notes receivable that have been endorsed or discounted by the company at the end of the period and have not yet matured on the balance sheet date

Unit: Yuan

Item Amount derecognized at the end of the period Amount not derecognized at the end of the period

Bank acceptance notes 0.00 607,772,933.44

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Commercial acceptance notes 0.00 15,389,935.84 Total 0.00 623,162,869.28

3. Accounts receivable

(1) Disclosure based on aging

Unit: Yuan

Aging Book balance at the end of the period Book balance at the beginning of the period

Within 1 year (including 1 year) 1,754,513,440.52 1,524,162,912.67 1 to 2 years 23,084,090.98 24,791,443.38 2 to 3 years 18,982,021.96 34,958,303.13 More than 3 years 53,001,832.98 31,091,275.38 3 to 4 years 24,707,493.28 6,243,738.79 4 to 5 years 7,718,196.31 6,234,908.74

More than 5 years 20,576,143.39 18,612,627.85 Total 1,849,581,386.44 1,615,003,934.56

(2) Classified disclosure according to bad debt accrual method

Unit: Yuan Ending balance Beginning balance

Book balance Provision for bad debts Book balance Provision for bad debts

Category Book price Book price provision ratio Provision ratio

Amount Ratio Amount Value Amount Ratio Amount Value

Example Example

By item

bad provision

53,410, 46,784, 6,626,0 55,886, 43,093, 12,793, Account provision 2.89% 87.59% 3.46% 77.11%

538.38 493.43 44.95 339.43 245.12 094.31 receivables

Accounts

its

Medium:

by combination

Bad provision 1,796,1 1,693,7 1,559,1 1,471,6

102,398 87,441,

Account provision 70,848. 97.11% 5.70% 72,137. 17,595. 96.54% 5.61% 75,677.

,710.44 917.47

Accounts receivable 06 62 13 66

its

Medium:

merge scope

1,796,1 1,693,7 1,559,1 1,471,6 Outside 102,398 87,441,

70,848. 97.11% 5.70% 72,137. 17,595. 96.54% 5.61% 75,677. Other customers, 710.44 917.47

06 62 13 66 households

1,849,5 1,700,3 1,615,0 1,484,4

149,183 130,535

Total 81,386. 0.00% 8.07% 98,182. 03,934. 100.00% 8.08% 68,771. ,203.87 ,162.59

44 57 56 97 Category name of bad debt provision accrued individually: Estimated to be unrecoverable

Unit: Yuan

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Beginning balance Closing balance

Name Provision Ratio

Book balance Bad debt provision Book balance Bad debt provision Examples of reasons for provision

Management expects Foshan Feichi Automotive Technology

20,218,807.63 10,109,403.82 20,286,772.23 16,229,417.78 80.00% Partially Uncollectible Co., Ltd.

return

Jiangxi Boneng Shangrao Bus Management expects

9,973,900.29 9,973,900.29 9,973,900.29 9,973,900.29 100.00%

Co., Ltd. cannot recover

Management expects Aerospace Lithium Battery Technology (Jiang

5,367,381.00 2,683,690.50 5,137,381.00 2,568,690.50 50.00% Partially unrecoverable Su) Co., Ltd.

return

Chengdu Dayun Automobile Group has management estimates

5,338,040.46 5,338,040.46 5,343,004.46 5,343,004.46 100.00%

Co., Ltd. Yuncheng Branch cannot recover Shenzhen Kelu Drive Technology. Management expects

2,452,215.68 2,452,215.68 2,452,215.68 2,452,215.68 100.00%

Co., Ltd. Unable to recover Suzhou Jiashengliang Enterprise Management Management expects

2,194,964.89 2,194,964.89 2,194,964.89 2,194,964.89 100.00%

Co., Ltd. cannot recover Shanghai Wanxiang Automobile Manufacturing Co., Ltd. Management expects

1,554,510.00 1,554,510.00 1,554,510.00 1,554,510.00 100.00%

Co., Ltd. cannot recover Shiyan Maozhu Industrial Co., Ltd. Management expects

1,530,000.00 1,530,000.00 1,530,000.00 1,530,000.00 100.00%

Division cannot recover

Management estimates that others 7,256,519.48 7,256,519.48 4,937,789.83 4,937,789.83 100.00%

Total that cannot be recovered 55,886,339.43 43,093,245.12 53,410,538.38 46,784,493.43

Category name of provision for bad debts by portfolio: Prudence

Unit: Yuan

Ending balance

Name

Book balance Bad debt provision Provision ratio

Within 1 year 1,754,352,556.17 87,717,627.81 5.00% 1 to 2 years 17,794,150.04 1,779,415.00 10.00% 2 to 3 years 11,260,163.19 3,378,048.96 30.00% 3 to 4 years 4,931,673.41 2,465,836.71 50.00% 4 to 5 years 3,872,616.40 3,098,093.12 80.00% More than 5 years 3,959,688.85 3,959,688.85 100.00% Total 1,796,170,848.06 102,398,710.44

Description of what this combination is based on:

Please refer to Note V. 11 for details on the recognition standards and explanation of bad debt provision on a group basis.

If bad debt provisions for accounts receivable are made according to the general expected credit loss model:

□Applicable Not applicable

(3) Bad debt provisions accrued, recovered or reversed in the current period

Bad debt provisions for the current period:

Unit: Yuan

Amount of changes in the current period

Category Beginning Balance Ending Balance

Provision Recovery or transfer Write-off Others

Individual provision 43,093,245.12 4,217,069.17 525,820.86 46,784,493.43 Combined provision 87,441,917.47 14,956,792.97 102,398,710.44Total 130,535,162.59 19,173,862.14 525,820.86 149,183,203.87

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

(4) Accounts receivable actually written off in the current period

Unit: Yuan

Item Write-off Amount

Actual write-off of accounts receivable 525,820.86 Among them, the write-off of important accounts receivable: None

Accounts receivable write-off instructions: None

(5) Accounts receivable and contract assets with the top five closing balances collected by debtors

Unit: Yuan accounts receivable and combined accounts receivable, bad debts, quasi-contract assets, balance at the end of the period, accounts receivable and contract assets

Unit name Closing balance of accounts receivable Closing balance of same assets Deduction of provision and contract assets Closing balance of production period

Proportion of the total number First place in value preparation closing balance 335,332,258.15 335,332,258.15 17.88% 16,784,600.45 Second place 331,834,384.45 4,080,000.00 335,914,384.45 17.91% 16,914,842.39 Third place 194,549,458.50 927,700.00 195,477,158.50 10.42% 10,400,272.55 Fourth place 107,395,904.96 107,395,904.96 5.73% 5,378,829.26Fifth place 102,206,922.96 8,116,830.16 110,323,753.12 5.88% 5,548,153.23Total 1,071,318,929.02 13,124,530.16 1,084,443,459.18 57.82% 55,026,697.88

4. Contract assets

(1) Contract assets

Unit: Yuan Ending balance Beginning balance

Project

Book balance Provision for bad debts Book value Book balance Provision for bad debts Book value

25,507,836.5 22,686,883.6 27,008,971.0 20,612,965.6 Unexpired warranty deposit 2,820,952.90 6,396,005.35

1 1 2 7 minus: listed in its -

• • • • -Other non-current assets 10,116,966.2

6,188,303.58 1,749,241.25 4,439,062.33 5,424,795.88 4,692,170.32 Contract assets 0

19,319,532.9 18,247,821.2 16,892,004.8 15,920,795.3 Total 1,071,711.65 971,209.47

3 8 2 5

(2) Classified disclosure according to bad debt accrual method

Unit: Yuan Ending balance Beginning balance

Book balance Provision for bad debts Book balance Provision for bad debts

Category Book price Book price provision ratio Provision ratio

Amount Ratio Amount Value Amount Ratio Amount Value

Example Example

By item

100,000 100,000 100,000 100,000

Bad provision 0.52% 100.00% 0.00 0.59% 100.00% 0.00

.00 .00 .00 .00

Account preparation

its

Medium:

By combination 19,219, 99.48% 971,711 5.06% 18,247, 16,792, 99.41% 871,209 5.19% 15,920,

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Provision for bad accounts 532.93 .65 821.28 004.82 .47 795.35

its

Medium:

merge scope

Outside the perimeter 19,219, 971,711 18,247, 16,792, 871,209 15,920,

99.48% 5.06% 99.41% 5.19%

Other customers 532.93 .65 821.28 004.82 .47 795.35 households

19,319, 1,071,7 18,247, 16,892, 971,209 15,920, total 100.00% 5.55% 100.00% 5.75%

532.93 11.65 821.28 004.82 .47 795.35 Category name of bad debt provision accrued individually: Estimated to be unrecoverable

Unit: Yuan Beginning balance Ending balance

Name

Book balance Bad debt provision Book balance Bad debt provision Provision ratio Reason for provision Sichuan Yema Automobile

100,000.00 100,000.00 100,000.00 100,000.00 100.00% It is expected that the joint stock company cannot be recovered

Total 100,000.00 100,000.00 100,000.00 100,000.00

Number of categories of bad debt provisions accrued by combination: 1

Category name of provision for bad debts by portfolio: Important

Unit: Yuan ending balance

Name

Book balance Bad debt provision Provision ratio

Within 1 year (including 1 year) 19,104,832.93 1,050,241.65 5.50% 1 to 2 years 214,700.00 21,470.00 10.00% 2 to 3 years

More than 3 years

3 to 4 years

4 to 5 years

More than 5 years

Total 19,319,532.93 1,071,711.65

Description of what this combination is based on:

Please refer to Note V. 11 for details on the recognition standards and explanation of bad debt provision on a group basis.

Provision for bad debts based on the general expected credit loss model

□Applicable Not applicable

(3) Bad debt provisions accrued, recovered or reversed in the current period

Unit: Yuan

Item Provision for the current period Recovered or reversed for the current period Write-off/write-off for the current period Reasons

Unexpired warranty deposit 100,502.18

Total 100,502.18——

5. Accounts receivable financing

(1) Classified presentation of financing receivables

Unit: Yuan

Item Ending balance Beginning balance

Notes receivable 55,160,805.74 61,467,445.23

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Total 55,160,805.74 61,467,445.23

(2) Financing of receivables that have been endorsed or discounted by the company at the end of the period and have not yet matured on the balance sheet date

Unit: Yuan

Item Amount derecognized at the end of the period Amount not derecognized at the end of the period

Bank acceptance bill 1,294,182,238.09 0.00 Total 1,294,182,238.09 0.00

6. Other receivables

Unit: Yuan

Item Ending balance Beginning balance

Other receivables 6,406,788.40 5,376,125.97 Total 6,406,788.40 5,376,125.97

(1) Other receivables

1. Classification of other receivables according to nature of payment

Unit: Yuan

Nature of payment Book balance at the end of the period Book balance at the beginning of the period

Security deposits and deposits 5,683,934.07 5,145,684.00 Reserve funds 894,790.67 230,325.56 Loans 400,000.00 400,000.00 Others 21,105.94 76,565.94 Total 6,999,830.68 5,852,575.50

2. Disclosure based on aging

Unit: Yuan

Aging Book balance at the end of the period Book balance at the beginning of the period

Within 1 year (including 1 year) 6,112,815.68 4,950,160.50 1 to 2 years 444,015.00 409,415.00 2 to 3 years 400,000.00 More than 3 years 443,000.00 93,000.00 3 to 4 years 400,000.00 50,000.00

More than 5 years 43,000.00 43,000.00 Total 6,999,830.68 5,852,575.50

3. Classified disclosure according to bad debt accrual method

Applicable □Not applicable

Unit: Yuan Ending balance Beginning balance

Category

Book balance Bad debt provision Book price Book balance Bad debt provision Book price

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Provision Ratio Provision Ratio Amount Ratio Amount Amount Ratio Amount

Example Example

Among them:

by combination

6,999,8 593,042 6,406,7 5,852,5 476,449 5,376,1 Bad provision 8.47% 8.47% 8.14% 8.14%

30.68 .28 88.40 75.50 .53 25.97Account preparation

Among them:

merge scope

Outside the perimeter 6,999,8 593,042 6,406,7 5,852,5 476,449 5,376,1

8.47% 8.47% 8.14% 8.14%

Other customers 30.68 .28 88.40 75.50 .53 25.97 households

6,999,8 593,042 6,406,7 5,852,5 476,449 5,376,1Total 8.47% 8.47% 8.14% 8.14%

30.68 .28 88.40 75.50 .53 25.97 Category name of bad debt provision by combination: Prudence

Unit: Yuan ending balance

Name

Book balance Bad debt provision Provision ratio

Within 1 year 6,112,815.68 305,640.78 5.00% 1 to 2 years 444,015.00 44,401.50 10.00% 2 to 3 years 400,000.00 120,000.00 30.00% 3 to 4 years 400,000.00 200,000.00 50.00% 4 to 5 years 0.00 0.00 80.00% More than 5 years 43,000.00 43,000.00 100.00% Total 6,999,830.68 593,042.28

Description of what this combination is based on:

Please refer to Note V. 11 for details on the recognition standards and explanation of bad debt provision on a group basis.

Provision for bad debts is made based on the general expected credit loss model:

Unit: Yuan Phase 1 Phase 2 Phase 3

Expected credit throughout the lifetime Credit expected throughout the lifetime

Provision for bad debts Expected credit in the next 12 months Total

Loss (no credit deduction has occurred Loss (credit deduction has occurred)

loss

value) value)

Balance as of January 1, 2026

In this issue

Basis for division of each stage and provision ratio for bad debts

Changes in book balances with significant changes in loss provision during the period

□Applicable Not applicable

4. Bad debt provisions accrued, recovered or reversed in the current period

Bad debt provisions for the current period:

Unit: Yuan

Amount of changes in the current period

Category Beginning Balance Ending Balance

Provision Recovery or transfer Write-off or write-off Others

Bad debt provision 476,449.53 116,847.47 254.72 593,042.28 Total 476,449.53 116,847.47 254.72 593,042.28 Among them, the amount of bad debt provision reversed or recovered in the current period is important:

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Unit: Yuan Determine the name of the original bad debt provision accrual unit, the amount recovered or reversed, the reason for the reverse, the method of recovery, the basis for the ratio and its reasonableness

sex

5. Other receivables with the top five closing balances collected by debtors

Unit: Yuan accounted for other receivables

Name of the unit with the balance at the end of the bad debt provision Nature of the payment Closing balance Aging Total balance at the end of the period

Um

proportion of numbers

Nantong Economic and Technological Development Zone Finance Bureau Security deposit and deposit 3,200,000.00 Within 1 year 45.72% 160,000.00 Carrier Automotive Technology (Anhui) Co., Ltd. Security deposit and deposit 500,000.00 Within 1 year 7.14% 25,000.00 Wujiang Economic and Technological Development Zone Urban-rural Integration

Security deposit and deposit 404,706.00 Within 1 year 5.78% 20,235.30 Construction Co., Ltd.

Nantong Eades Industrial Development Co., Ltd. Security deposit and deposit 380,240.73 Within 1 year 5.43% 19,012.04 Jiangsu Shengjinte Auto Parts Co., Ltd. Security deposit and deposit 340,000.00 1-2 years 4.86% 34,000.00 Total 4,824,946.73 68.93% 258,247.34

7. Prepayment

(1) Prepayments are listed based on aging

Unit: Yuan Ending balance Beginning balance

Aging

Amount Ratio Amount Ratio

Within 1 year 21,429,045.66 95.64% 13,322,747.88 92.45% 1 to 2 years 568,665.77 2.54% 985,392.33 6.84% 2 to 3 years 342,720.10 1.53% 99,045.29 0.69% More than 3 years 65,605.03 0.29% 3,488.00 0.02% Total 22,406,036.56 14,410,673.50

Explanation on the reasons why prepayments with an aging of more than 1 year and significant amounts were not settled in a timely manner: None

(2) Prepayments with the top five ending balances by prepayment objects

Unit name Balance as of June 30, 2026 Proportion of total prepayment balance (%) First place 3,820,754.72 17.05 Second place 1,421,932.57 6.35 Third place 1,308,000.01 5.84 Fourth place 996,359.38 4.45 Fifth place 803,660.45 3.59 Total 8,350,707.13 37.28 Other instructions: None

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

8. Inventory

Whether the company needs to comply with the real estate industry’s disclosure requirements

No

(1) Inventory classification

Unit: Yuan Ending balance Beginning balance

Provision for inventory decline Provision for inventory decline

Project

Book balance or contract performance costs Book value Book balance or contract performance costs Book value impairment provision This impairment provision

241,686,100. 21,314,122.0 220,371,978. 199,093,008. 19,706,543.6 179,386,464. Raw materials

95 6 89 51 7 84

245,676,944. 19,910,469.8 225,766,474. 226,472,177. 21,973,222.7 204,498,954. Inventory goods

27 2 45 50 6 74 Contract performance costs 1,351,510.57 1,351,510.57 1,094,968.78 1,094,968.78

248,133,220. 244,137,828. 185,308,942. 179,148,896. Shipment of goods 3,995,391.26 6,160,045.99

18 92 52 53

27,969,161.2 27,554,762.2 15,484,494.3 15,143,394.2 Entrusted processing materials 414,398.99 341,100.02

3 4 1 9

338,394,212. 10,841,726.0 327,552,486. 232,545,240. 11,480,752.0 221,064,488. Semi-finished products

87 2 85 48 0 48

1,103,211,15 56,476,108.1 1,046,735,04 859,998,832. 59,661,664.4 800,337,167.Total

0.07 5 1.92 10 4 66

(2) Provision for inventory depreciation and provision for impairment of contract performance costs

Unit: Yuan Increase amount in this period Decrease amount in this period

Item Beginning balance Closing balance

Provision Others Reversal or write-off Others

Raw materials 19,706,543.67 6,081,009.13 4,473,430.74 21,314,122.06 Inventory goods 21,973,222.76 6,950,662.54 9,013,415.48 19,910,469.82 Commissioned processing materials 341,100.02 131,516.74 58,217.77 414,398.99Goods shipped 6,160,045.99 301,009.52 2,465,664.25 3,995,391.26 Semi-finished products 11,480,752.00 3,405,361.79 4,044,387.77 10,841,726.02 Total 59,661,664.44 16,869,559.72 20,055,116.01 56,476,108.15

9. Assets held for sale

10. Non-current assets due within one year

Unit: Yuan

Item Ending balance Beginning balance

Long-term receivables due within one year 14,919,660.04 16,508,880.84 Less: Impairment provisions -2,527,157.81 -2,335,131.25 Total 12,392,502.23 14,173,749.59

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

(1) Debt investments due within one year

□Applicable Not applicable

(2) Other debt investments due within one year

□Applicable Not applicable

11. Other current assets

Unit: Yuan

Item Closing balance Opening balance of retained tax and input tax to be deducted 43,846,228.12 43,917,545.06 Listing agency fees 25,036,226.42 5,044,716.99 Total 68,882,454.54 48,962,262.05

Information about compensating assets

Other instructions: none

12. Investment in other equity instruments

Unit: Yuan Designated as fair value included in the current period Included in the current period Accumulated at the end of the period Accumulated at the end of the period

Confirmed and measured in the current period and its

Other comprehensive Other comprehensive Included in it Included in it

Item name Dividend income at the beginning of the period Dividend income at the end of the period Changes included in income Loss of income Other comprehensive income Other comprehensive income

Income Other comprehensive gains and losses Gains and losses

original income

Because of Xuzhou XCMG

Automotive technology 30,000,00 30,000,00

0.00 0.00 0.00 0.00 0.00

Co., Ltd. 0.00 0.00 Company

Jiangsu Guochuang

New energy provider

5,000,000 5,000,000Car innovation 0.00 0.00 0.00 0.00 0.00

.00 .00 TECHNOLOGY LIMITED

company

Shaanxi Xichuang

Prudential Information

Technical services 1,000,000 1,000,000

0.00 0.00 0.00 0.00 0.00

Partnership .00 .00 (limited partnership

Guy)

SAIC Hongyan

551,764.1 551,764.1 551,764.1 Automobile Co., Ltd. 0.00 0.00 0.00 0.00

4 4 4 company

36,000,00 551,764.1 551,764.1 36,551,76Total 0.00 0.00 0.00

0.00 4 4 4.14

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

13. Long-term receivables

(1) Long-term receivables

Unit: Yuan Ending balance Beginning balance

Item Discount rate range Book balance Bad debt provision Book value Book balance Bad debt provision Book value

3,035,450. 1,071,538. 1,963,911. 2,786,327. 2,062,909.

Finance lease payment 723,418.41 2.7%-4.45% 12 50 62 92 51

Among them:

---

Unrealized financing 0.00 2.7%-4.45%

258,553.18 258,553.18 263,123.97 263,123.97

income

Installment collection sales 14,919,660 2,527,157. 12,392,502 16,510,376 2,335,206. 14,175,169

2.7%-4.45% goods sold .05 81 .24 .03 25 .78

Less: Within one year - - - - - -

Long-term due 14,919,660 2,527,157. 12,392,502 16,508,880 2,335,131. 14,173,749 2.7%-4.45% receivables .04 81 .23 .84 25 .59

3,035,450. 1,071,538. 1,963,911. 2,787,823. 2,064,329.

Total 723,493.41

13 50 63 11 70

(2) Classified disclosure according to bad debt accrual method

Unit: Yuan Ending balance Beginning balance

Book balance Provision for bad debts Book balance Provision for bad debts

Category Book price Book price provision ratio Provision ratio

Amount Ratio Amount Value Amount Ratio Amount Value

Example Example

Among them:

by combination

3,035,4 1,071,5 1,963,9 2,787,8 723,493 2,064,3 Bad provision 100.00% 35.30% 100.00% 25.95%

50.13 38.50 11.63 23.11 .41 29.70Account preparation

Among them:

merge scope

Outside the perimeter 3,035,4 1,071,5 1,963,9 2,787,8 723,493 2,064,3

100.00% 35.30% 100.00% 25.95%

Other customers 50.13 38.50 11.63 23.11 .41 29.70 households

3,035,4 1,071,5 1,963,9 2,787,8 723,493 2,064,3Total 100.00% 35.30% 100.00% 25.95%

50.13 38.50 11.63 23.11 .41 29.70 Category name of bad debt provision by combination: Prudence

Unit: Yuan ending balance

Name

Book balance Bad debt provision Provision ratio

Within 1 year (including 1 year)

1 to 2 years 199,483.50 19,948.35 10.00% 2 to 3 years 2,158,118.83 647,435.65 30.00% More than 3 years 677,847.80 404,154.49 59.62% 3 to 4 years 460,412.47 230,206.24 50.00% 4 to 5 years 217,435.32 173,948.26 80.00% More than 5 years

Total 3,035,450.13 1,071,538.50

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Description of what this combination is based on:

Please refer to Note V. 11 for details on the recognition standards and explanation of bad debt provision on a group basis.

Provision for bad debts based on the general expected credit loss model

Unit: Yuan Phase 1 Phase 2 Phase 3

Expected credit throughout the lifetime Credit expected throughout the lifetime

Bad debt provision Expected total credit losses in the next 12 months (no credit deductions have occurred Losses (credit deductions have occurred)

loss

value) value)

Balance as of January 1, 2026

In this issue

Basis for division of each stage and provision ratio for bad debts

(3) Bad debt provisions accrued, recovered or reversed in the current period

Unit: Yuan Amount of changes in the current period

Category Opening balance Ending balance Provision Recovery or reversal Write-off or write-off Others

Combined provision 723,493.41 348,045.09 1,071,538.50 Total 723,493.41 348,045.09 1,071,538.50 Among them, the amount of bad debt provision reversed or recovered in the current period is important: None

Other instructions: none

14. Investment real estate

(1) Investment real estate using cost measurement model

Applicable □Not applicable

Unit: Yuan Project Houses, buildings Land use rights Construction in progress Total

1. Original book value

1. Opening balance 66,117,164.97 17,979,970.96 84,097,135.93 2. Increase in the current period

(1) Outsourcing

(2) Inventory\fixed assets

Transferring production\projects under construction

(3) Business merger increases

add

3. Reduction amount in this period

(1) Disposal

(2) Other transfer-out

4. Closing balance 66,117,164.97 17,979,970.96 84,097,135.93

2. Accumulated depreciation and accumulated amortization

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

1. Balance at the beginning of the period 25,115,104.70 4,086,742.40 29,201,847.10 2. Increase in the current period 1,578,078.24 179,799.66 1,757,877.90

(1) Provision or amortization 1,578,078.24 179,799.66 1,757,877.90

3. Reduction amount in this period

(1) Disposal

(2) Other transfer-out

4. Closing balance 26,693,182.94 4,266,542.06 30,959,725.00

3. Impairment provision

1. Opening balance

2. Increase amount in this period

(1) Provision

3. Reduction amount in this period

(1) Disposal

(2) Other transfer-out

4. Ending balance

4. Book value

1. Book value at the end of the period 39,423,982.03 13,713,428.90 53,137,410.93 2. Book value at the beginning of the period 41,002,060.27 13,893,228.56 54,895,288.83 The recoverable amount is determined based on the net amount of fair value minus disposal costs.

□Applicable Not applicable

The recoverable amount is determined based on the present value of expected future cash flows.

□Applicable Not applicable

Reasons for the obvious inconsistency between the aforementioned information and the information used in impairment testing in previous years or external information

None

Reasons for the discrepancy between the information used in the company's impairment testing in previous years and the actual situation of that year.

None

Other instructions: none

(2) Investment real estate using fair value measurement model

□Applicable Not applicable

15. Fixed assets

Unit: Yuan

Item Ending balance Beginning balance

Fixed assets 806,838,096.18 605,507,584.60 Total 806,838,096.18 605,507,584.60

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

(1) Fixed assets

Unit: Yuan Electronic Equipment and its

Items Houses and buildings Machinery and equipment Transportation equipment Tools and equipment Total

him

1. Original books

Value:

1. Balance at the beginning of the period 255,171,875. 452,135,283. 34,081,596.5 78,618,198.0 15,256,952.2 835,263,905. Amount 31 31 3 7 4 46 2. Increase in this period 147,898,883. 72,610,708.0 12,732,578.4 242,901,610.

5,693,075.21 3,966,365.19

Added amount 98 1 9 88 (1 18,328,978.4

1,059,329.20 3,272,784.33 2,006,384.95 8,040,397.93 3,950,082.00

) Purchase 1 (2

146,839,554. 69,337,923.6 224,572,632.) Construction in progress 3,686,690.26 4,692,180.56 16,283.19

78 8 47 in

(3

) Business merger increases

add

3. Less for this period

1,684,567.83 852,952.75 625,942.38 39,000.41 3,202,463.37 Small amount

(1

1,684,567.83 852,952.75 625,942.38 39,000.41 3,202,463.37) Disposal or scrapping

4. Ending balance 403,070,759. 523,061,423. 38,921,718.9 90,724,834.1 19,184,317.0 1,074,963,05 29 49 9 8 2 2.97

2. Accumulated depreciation

1. Opening balance 49,489,003.0 117,645,265. 17,824,363.3 34,833,903.1 229,756,320.

9,963,785.63

Amount 8 69 1 5 86 2. Increase in this period 22,903,622.1 40,734,845.0

6,083,229.33 3,563,311.12 7,077,564.78 1,107,117.67

Add amount 0 0 (1 22,903,622.1 40,734,845.0

6,083,229.33 3,563,311.12 7,077,564.78 1,107,117.67

) Provision 0 0

3. Less for this period

1,049,086.18 804,560.92 502,732.66 9,829.31 2,366,209.07 Small amount

(1

1,049,086.18 804,560.92 502,732.66 9,829.31 2,366,209.07) Disposal or scrapping

4. Ending balance 55,572,232.4 139,499,801. 20,583,113.5 41,408,735.2 11,061,073.9 268,124,956. Amount 1 61 1 7 9 79

3. Impairment provision

1. Balance at the beginning of the period

Um

2.Increase in this period

Add amount

(1

) accrual

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

3. Less for this period

small amount

(1

) disposal or scrapping

4. End of period balance

Um

4. Book value

1. Closing accounts 347,498,526. 383,561,621. 18,338,605.4 49,316,098.9 806,838,096.

8,123,243.03

Face value 88 88 8 1 18 2. Opening account 205,682,872. 334,490,017. 16,257,233.2 43,784,294.9 605,507,584.

5,293,166.61

Face value 23 62 2 2 60

16. Projects under construction

Unit: Yuan

Item Ending balance Beginning balance

Construction in progress 203,404,490.65 172,254,255.59 Total 203,404,490.65 172,254,255.59

(1) Projects under construction

Unit: Yuan Ending balance Beginning balance

Project

Book balance Impairment provision Book value Book balance Impairment provision Book value New factory infrastructure 164,867,643.09 164,867,643.09 114,627,215.57 114,627,215.57 Equipment being installed 38,536,847.56 38,536,847.56 57,627,040.02 57,627,040.02 Total 203,404,490.65 203,404,490.65 172,254,255.59 172,254,255.59

(2) Changes in important projects under construction during the current period

Unit: Yuanqi

Engineering

Interest in this period:

Current period Cumulative Current period

Capital transferred in this period This period

Project Budget Beginning of Period Others End of Period Investment Project Interest Funds

Increase fixed accumulated interest

Name Number Balance Decrease Balance Accounting for Advance Progress Capital Source Amount Asset Accounting Capital

Amount calculation ratio

Amount Amount Funding

Example

Um

Finance 90mu 36,69 25,61 10,88 36,50 Institution

99.47 90.00

Research and development 7,247 9,781 1,600 1,381 Loan

% %

Building .71 .56 .19 .75, others

Finance 87mu 183.4 78.14 86.47 146.8 17.78 Institutions

89.72 92.00

New construction 86,23 6,679 3,666 39,55 0,790 Loan

% %

Factory building 8.53 .10 .40 4.78 .72 models,

Other Nantong 176.1 10.47 100.1 110.5 62.78 56.98 Finance

Suzhou Lvkong Transmission Technology Co., Ltd. 2026 Semi-annual Report Full text Factory area 46,78 3,436 12,03 85,47 % % New institution 8.99 .84 3.78 0.62 Factory loan, others

396,3 114,2 197,4 146,8 164,8

Total 30,27 39,89 67,30 39,55 67,64

5.23 7.50 0.37 4.78 3.09

(3) Impairment testing of projects under construction

□Applicable Not applicable

17. Productive biological assets

(1) Productive biological assets using cost measurement model

□Applicable Not applicable

(2) Impairment testing of productive biological assets using the cost measurement model

□Applicable Not applicable

(3) Productive biological assets using fair value measurement model

□Applicable Not applicable

18. Oil and gas assets

□Applicable Not applicable

19. Right-of-use assets

(1) Right-of-use assets

Unit: Yuan

Project Houses and Buildings Total

1. Original book value

1. Balance at the beginning of the period 11,072,668.89 11,072,668.89 2. Increase in the current period

2. Reduction amount in this period

3. Closing balance 11,072,668.89 11,072,668.89

2. Accumulated depreciation

1. Balance at the beginning of the period 2,768,167.22 2,768,167.22 2. Increase in the current period 1,845,444.84 1,845,444.84

(1) Provision 1,845,444.84 1,845,444.84 3. Decrease amount in the current period

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

(1) Disposal

4. Closing balance 4,613,612.06 4,613,612.06

3. Impairment provision

1. Opening balance

2. Increase amount in this period

(1) Provision

3. Reduction amount in this period

(1) Disposal

4. Ending balance

4. Book value

1. Book value at the end of the period 6,459,056.83 6,459,056.83 2. Book value at the beginning of the period 8,304,501.67 8,304,501.67

(2) Impairment testing of right-of-use assets

□Applicable Not applicable

20. Intangible assets

(1) Intangible assets

Unit: Yuan

Project Land use rights Patent rights Non-patented technology Software Total

1. Original book value

1. Opening balance 93,961,569.78 8,262,135.93 100,000.00 16,920,786.63 119,244,492.34 2. Increase in this period

4,406,098.62 Amount of 4,406,098.62

(1) Purchase

4,406,098.62 4,406,098.62

(2) within

Ministry of R&D

(3) Enterprise

Increase in business mergers

3. Reduction in this period

Amount

(1) place

set

4. Ending balance 93,961,569.78 8,262,135.93 100,000.00 21,326,885.25 123,650,590.96

2. Accumulated amortization

1. Opening balance 7,166,860.43 1,721,278.25 100,000.00 12,761,521.95 21,749,660.63 2. Increase in this period

1,078,853.63 413,106.78 846,966.16 2,338,926.57Amount

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

(1) Count

1,078,853.63 413,106.78 846,966.16 2,338,926.57

3. Reduction in this period

Amount

(1) place

set

4. Closing balance 8,245,714.06 2,134,385.03 100,000.00 13,608,488.11 24,088,587.20

3. Impairment provision

1. Opening balance

2.Increase in this issue

Amount

(1) Count

mention

3. Reduction in this period

Amount

(1) place

set

4. Ending balance

4. Book value

1. Closing accounts

85,715,855.72 6,127,750.90 - 7,718,397.14 99,562,003.76 value

2. Opening accounts

86,794,709.35 6,540,857.68 - 4,159,264.68 97,494,831.71 Value

The proportion of intangible assets formed through the company's internal research and development at the end of the period to the balance of intangible assets is 0.00%

(2) Impairment testing of intangible assets

□Applicable Not applicable

21. Long-term deferred expenses

Unit: Yuan

Item Beginning balance Increase in the current period Amortization amount in the current period Other decreases Closing balance Decoration expenses 17,459,950.33 3,397,976.13 4,459,163.07 0.00 16,398,763.39 Tools and equipment 14,610,607.88 9,420,066.93 4,447,242.06 0.00 19,583,432.75 Others 41,420.83 165,131.86 52,114.04 0.00 154,438.65Total 32,111,979.04 12,983,174.92 8,958,519.17 0.00 36,136,634.79Other instructions: None

22. Deferred income tax assets/deferred income tax liabilities

(1) Deferred income tax assets without offset

Unit: Yuan

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Ending balance Beginning balance

Project

Deductible temporary differences Deferred income tax assets Deductible temporary differences Deferred income tax assets Asset impairment provision 59,225,502.71 9,954,259.36 65,734,824.53 11,239,712.63 Uncovered losses 292,213,538.88 45,002,447.18 377,245,002.72 56,586,750.41 Estimated liabilities 193,576,919.68 29,036,537.95 143,903,597.03 21,585,539.55 Credit impairment provision 151,172,912.77 24,018,986.85 132,638,133.92 21,255,009.83 Government subsidies 145,308,802.63 23,114,006.84 144,851,935.09 21,742,082.58 Accrued expenses 44,919,242.16 6,737,886.32 50,908,424.24 7,636,263.64 Lease liabilities 5,721,557.85 1,430,389.46 7,503,961.10 1,875,990.28 Unrealized internal gains and losses 1,696,069.93 254,410.49 2,232,146.07 334,821.91Total 893,834,546.61 139,548,924.45 925,018,024.70 142,256,170.83

(2) Deferred income tax liabilities without offset

Unit: Yuan Ending balance Beginning balance

Project

Taxable temporary differences Deferred income tax liabilities Taxable temporary differences Deferred income tax liabilities Accelerated depreciation of fixed assets 14,984,239.65 3,109,995.80 17,161,541.36 3,580,938.72 Right-of-use assets 6,459,056.83 1,614,764.21 8,304,501.67 2,076,125.42 Total 21,443,296.48 4,724,760.01 25,466,043.03 5,657,064.14

(3) Deferred income tax assets or liabilities presented on a net basis after offsetting

Unit: Yuan Deferred income tax assets and liabilities Deferred income tax assets after offset Deferred income tax assets and liabilities Deferred income tax items after offset

Offset amount at the end of the debt period Ending balance of assets or liabilities Offset amount at the beginning of the debt period Deferred income tax assets 2,784,090.12 136,764,834.33 3,411,276.85 138,844,893.98 Deferred income tax liabilities 2,784,090.12 1,940,669.89 3,411,276.85 2,245,787.29

(4) Details of deferred income tax assets not recognized

Unit: Yuan

Item Ending balance Beginning balance

Deductible temporary differences 2,281,088.04 2,359,195.97 Deductible losses 7,588,662.64 7,574,450.05 Total 9,869,750.68 9,933,646.02

(5) Deductible losses that have not been recognized as deferred income tax assets will expire in the following years

Unit: Yuan

Year Ending amount Beginning amount Remarks

2026 3,924.49 3,924.49

2027 1,291,090.58 1,291,090.58

2028 1,825,474.03 1,825,474.03

2029 2,855,904.55 2,855,904.55

2030 1,612,268.99 1,598,056.40

Total 7,588,662.64 7,574,450.05

Other instructions: none

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

23. Other non-current assets

Unit: Yuan Ending balance Beginning balance

Project

Book balance Impairment provision Book value Book balance Impairment provision Book value

10,116,966.2

Contract assets 6,188,303.58 1,749,241.25 4,439,062.33 5,424,795.88 4,692,170.32

129,274,652. 129,274,652. 47,153,209.3 47,153,209.3 Engineering equipment

25 25 1 1

135,462,955. 133,713,714. 57,270,175.5 51,845,379.6Total 1,749,241.25 5,424,795.88

83 58 1 3 Information related to compensating assets: Not applicable

Other instructions: none

24. Assets whose ownership or use rights are restricted

Unit: End of Yuan period Beginning of period

Project

Book balance Book value Restriction type Restriction situation Book balance Book value Restriction type Restriction situation

10,582,56 10,582,56 13,532,53 13,532,53

Monetary funds guarantee margin guarantee margin5.06 5.06 1.56 1.56

End of period discount End of period discount or endorsement but or endorsement but

623,162,8 623,162,8 Not terminated but not yet matured 497,772,7 497,772,7 Not terminated but not yet mature Notes receivable

69.28 69.28 Confirmed bills receivable 73.85 73.85 Confirmed amount of bills receivable that has not been terminated Confirmed amount

193,556,8 193,556,8 198,881,4 198,881,4

Inventory Mortgage Mortgage loan Mortgage Mortgage loan 89.54 89.54 71.17 71.17

68,785,27 68,785,27 48,570,65 48,570,65

Fixed assets Mortgage Mortgage borrowing Mortgage Mortgage borrowing 6.83 6.83 7.93 7.93

50,724,47 50,724,47 54,895,28 54,895,28

Intangible assets Mortgage Mortgage loan Mortgage Mortgage loan 0.94 0.94 8.83 8.83

946,812,0 946,812,0 813,652,7 813,652,7

total

71.65 71.65 23.34 23.34

Other instructions: none

25. Short-term borrowing

(1) Classification of short-term loans

Unit: Yuan

Item Ending balance Beginning balance

Mortgage loan 110,000,000.00 120,000,000.00 Guaranteed loan 193,831,816.42 282,890,000.00 Credit loan 1,072,774,573.97 376,510,000.00 Bill discount 34,161,365.88 10,000,000.00 Accrued interest 781,819.04 466,323.73 Total 1,411,549,575.31 789,866,323.73 Description of short-term loan classification: None

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

26. Notes payable

Unit: Yuan

Category Ending balance Beginning balance

Bank acceptance bill 429,774,053.75 144,036,515.72 Total 429,774,053.75 144,036,515.72 The total amount of bills payable that has expired but not been paid at the end of this period is 0.00 yuan, and the reason for unpaid due is none.

27. Accounts payable

(1) Presentation of accounts payable

Unit: Yuan

Item Ending balance Beginning balance

Raw materials 1,439,140,582.53 1,292,965,587.38 Engineering equipment 101,775,989.07 119,929,919.97 Maintenance and inspection fees 51,726,557.43 34,468,662.20 Other expenses 55,498,640.55 41,403,883.37 Total 1,648,141,769.58 1,488,768,052.92

28. Other payables

Unit: Yuan

Item Ending balance Beginning balance

Other payables 79,039,941.58 72,674,092.70 Total 79,039,941.58 72,674,092.70

(1) Other payables

1. List other payables according to the nature of the payment

Unit: Yuan

Item Ending balance Beginning balance

Rebate 44,919,242.16 50,908,424.24 Service fee 16,608,403.02 3,437,498.45 Claim money 6,943,142.67 4,173,674.83 Rent, water and electricity 3,166,488.19 1,768,923.82 Security deposit and deposit 2,159,498.30 6,267,806.99 Employee reimbursement 1,636,466.36 3,331,940.10 Others 3,606,700.88 2,785,824.27 Total 79,039,941.58 72,674,092.70

29. Contract liabilities

Unit: Yuan

Item Ending balance Beginning balance

Advance payment for goods received 11,451,156.82 8,386,403.90 Total 11,451,156.82 8,386,403.90

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Important contract liabilities aged more than 1 year: None

30. Payable to employees’ salaries

(1) Presentation of employee benefits payable

Unit: Yuan

Item Opening balance Increase in the current period Decrease in the current period Ending balance

1. Short-term salary 72,525,188.87 222,484,487.34 218,020,086.10 76,989,590.11

2. Post-employment benefits-settings

14,794,918.17 14,502,458.90 292,459.27 Withdrawal plan

3. Dismissal benefits 298,002.52 298,002.52

Total 72,525,188.87 237,577,408.03 232,820,547.52 77,282,049.38

(2) Presentation of short-term remuneration

Unit: Yuan

Item Opening balance Increase in the current period Decrease in the current period Ending balance

1. Salaries, bonuses, allowances and subsidies 72,383,015.97 200,778,857.66 196,484,718.36 76,677,155.27

2. Employee welfare fees 6,565,266.98 6,565,266.98

3. Social insurance premiums 7,351,476.93 7,227,253.99 124,222.94 Including: medical insurance premiums 6,147,443.37 6,045,303.69 102,139.68 Work-related injury insurance premiums 578,713.80 569,490.62 9,223.18

Maternity insurance premium 625,319.76 612,459.68 12,860.08

4. Housing provident fund 7,452,825.01 7,452,825.01

5. Union funds and employee education funds 142,172.90 336,060.76 290,021.76 188,211.90 Total 72,525,188.87 222,484,487.34 218,020,086.10 76,989,590.11

(3) Display of defined contribution plan

Unit: Yuan

Item Opening balance Increase in the current period Decrease in the current period Ending balance

1. Basic pension insurance 14,345,987.19 14,062,442.82 283,544.37

2. Unemployment insurance premium 448,930.98 440,016.08 8,914.90Total 14,794,918.17 14,502,458.90 292,459.27Other notes: None

3. Taxes payable

Unit: Yuan

Item Ending balance Beginning balance

Value-added tax 1,191,233.87 5,897,066.36 Corporate income tax 2,112,173.26 13,136,968.46 Personal income tax 1,605,400.48 1,214,115.38 Urban maintenance and construction tax 65,695.68 377,537.51

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Education fee surcharge 28,155.29 176,920.63 Local education fee surcharge 18,770.19 117,947.10 Stamp tax 1,301,874.14 985,790.79 Property tax 938,209.39 941,351.38 Environmental protection tax 308,451.03 113,268.18 Urban land use tax 145,529.26 106,523.85 Total 7,715,492.59 23,067,489.64 Other notes: None

32. Non-current liabilities due within one year

Unit: Yuan

Item Ending balance Beginning balance

Long-term borrowings due within one year 81,559,695.77 133,005,361.67 Lease liabilities due within one year 3,750,597.17 3,596,889.74 Total 85,310,292.94 136,602,251.41 Other notes: None

33. Other current liabilities

Unit: Yuan

Item Ending balance Beginning balance

Output tax to be transferred 2,591,247.86 3,475,157.13 Endorsed but not terminated bills 589,001,503.40 497,772,773.85 Total 591,592,751.26 501,247,930.98 Other notes: None

34. Long-term borrowing

(1) Classification of long-term loans

Unit: Yuan

Item Ending balance Beginning balance

Mortgage loans 60,394,615.63 26,505,180.00 Guaranteed loans 132,247,858.54 82,310,037.00 Credit loans 13,500,000.00 73,650,000.00 Accrued interest 152,531.94 145,410.65 Less: Long-term borrowings due within one year -81,559,695.77 -133,005,361.67 Total 124,735,310.34 49,605,265.98 Description of long-term borrowing classification: None

Other instructions, including interest rate range: None

35. Lease liabilities

Unit: Yuan

Item Ending balance Beginning balance

Lease payment 5,877,453.40 7,777,824.60

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Less: Unrecognized financing costs -155,895.55 -273,863.50 Less: Lease liabilities due within one year -3,750,597.17 -3,596,889.74Total 1,970,960.68 3,907,071.36Other notes: None

36. Estimated liabilities

Unit: Yuan Item Ending balance Beginning balance Reason for formation

Based on the principle of prudence, the company guarantees product quality 193,576,919.68 143,903,597.03

Total quality deposits accrued at a fixed proportion 193,576,919.68 143,903,597.03

Other explanations, including important assumptions and estimation instructions related to important estimated liabilities: None

37. Deferred income

Unit: Yuan Item Beginning balance Increase in the current period Decrease in the current period Ending balance Reasons for formation

Government subsidies received related to assets and government subsidies 129,006,025.72 13,050,000.00 17,568,735.26 124,487,290.46 income

Single performance of a single warranty period beyond the warranty period 15,956,209.93 7,451,341.99 2,577,433.57 20,830,118.35

Total performance obligations 144,962,235.65 20,501,341.99 20,146,168.83 145,317,408.81

Other instructions: none

38. Share capital

Unit: Yuan Increase or decrease in this change (+, -)

Beginning balance Closing balance

Issuance of new shares Bonus shares Conversion of public reserve funds Others Subtotal

Total number of shares 387,267,000.00 387,267,000.00 Other instructions: None

39. Capital reserve

Unit: Yuan

Item Opening balance Increase in the current period Decrease in the current period Ending balance Capital premium (equity premium

585,662,091.84 585,662,091.84 price)

Other capital reserves 41,958,666.43 4,647,234.09 46,605,900.52 Total 627,620,758.27 4,647,234.09 632,267,992.36 Other explanations, including changes in the current period and reasons for changes: None

40. Other comprehensive income

Unit: Yuan

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Amount incurred this period

Less: previous period Less: previous period

Income for the current period is included in other items and is included in others. Attribution after tax

Item Opening balance Less: Income Attribution after tax Closing balance before tax Comprehensive income Comprehensive income Attributable to minority shares

Tax expenses at the parent company

Amount transferred in the current period Transferred in in the current period

Profit and loss Retained earnings

2. Will be heavy

Classified loss - - -Other gains 16,244.50 16,244.50 16,244.50 Comprehensive income

foreign currency

• • -Financial Statements

16,244.50 16,244.50 16,244.50 Conversion difference

Other comprehensive - - - Total income 16,244.50 16,244.50 16,244.50 Other explanations, including adjustments to the initial recognition amount of the effective part of cash flow hedging gains and losses into hedged items: None

41. Special reserves

Unit: Yuan

Item Opening balance Increase in the current period Decrease in the current period Ending balance Safety production expenses 11,366,336.89 2,981,840.94 2,691,986.09 11,656,191.74 Total 11,366,336.89 2,981,840.94 2,691,986.09 11,656,191.74 Other explanations, including changes in increases and decreases in the current period and reasons for changes: None

42. Undistributed profits

Unit: Yuan

Projects in this issue Previous issue

Undistributed profit at the end of the previous period before adjustment -118,248,415.33 -271,410,146.49 Undistributed profit at the beginning of the period after adjustment -118,248,415.33 -271,410,146.49 Plus: Net profit attributable to owners of the parent company for the current period

123,358,682.78 153,161,731.16 profit

Undistributed profits at the end of the period 5,110,267.45 -118,248,415.33 Adjustment of undistributed profits at the beginning of the period:

1). Due to the retrospective adjustment of the Accounting Standards for Business Enterprises and its related new regulations, the undistributed profit at the beginning of the period was affected by RMB 0.00.

2. Due to changes in accounting policies, the undistributed profit at the beginning of the period was affected by RMB 0.00.

3. Due to the correction of major accounting errors, the undistributed profit at the beginning of the period was affected by RMB 0.00.

4). Changes in the scope of consolidation due to the same control affect the undistributed profit at the beginning of the period by RMB 0.00.

5. The total impact of other adjustments on the undistributed profit at the beginning of the period is RMB 0.00.

Detailed description of using capital reserves to make up for losses: None

43. Operating income and operating costs

Unit: Yuan

Item Amount for the current period Amount for the previous period

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

revenue cost revenue cost

Main business 2,313,310,362.13 1,972,287,787.71 1,188,341,181.59 959,799,575.49 Other businesses 52,477,731.44 52,659,888.63 30,722,038.41 23,004,067.09 Total 2,365,788,093.57 2,024,947,676.34 1,219,063,220.00 982,803,642.58 Decomposition information of operating income and operating costs:

Unit: Yuan Division 1 Total

Contract classification

Operating income Operating cost Operating income Operating cost Business type 2,313,310,362.13 1,972,287,787.71 2,313,310,362.13 1,972,287,787.71 Among them:

Trucks 2,028,869,475.43 1,783,826,114.89 2,028,869,475.43 1,783,826,114.89 Passenger cars 51,767,633.51 30,491,807.26 51,767,633.51 30,491,807.26 Non-road mobile machinery 162,581,928.21 108,478,021.15 162,581,928.21 108,478,021.15 Parts and accessories 48,350,868.66 34,506,021.43 48,350,868.66 34,506,021.43 Technology development and services 2,596,579.63 2,047,425.77 2,596,579.63 2,047,425.77 Others 19,143,876.69 12,938,397.21 19,143,876.69 12,938,397.21 Classified by operating area 2,313,310,362.13 1,972,287,787.71 2,313,310,362.13 1,972,287,787.71

Among them:

Domestic 2,286,846,796.64 1,959,106,210.55 2,286,846,796.64 1,959,106,210.55 Overseas 26,463,565.49 13,181,577.16 26,463,565.49 13,181,577.16Market or customer type

Among them:

Contract type

Among them:

According to the time of commodity transfer

class

Among them:

Classification by contract period

Among them:

Classified by sales channel

Among them:

Total 2,313,310,362.13 1,972,287,787.71 2,313,310,362.13 1,972,287,787.71

44. Taxes and surcharges

Unit: Yuan

Item Amount for the current period Amount for the previous period

Urban maintenance and construction tax 427,226.73 548,061.79 Education fee surcharge 187,070.00 240,042.52 Property tax 1,865,365.54 1,734,683.64 Land use tax 291,058.52 145,037.82 Vehicle and vessel use tax 970.40 121.20

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Stamp duty 2,809,606.95 1,217,417.03 Local education surcharge 124,713.32 160,028.34 Environmental protection tax 492,301.62 81,200.70 Total 6,198,313.08 4,126,593.04

Other instructions: none

45. Management expenses

Unit: Yuan

Item Amount for the current period Amount for the previous period

Employee compensation 23,079,877.39 17,474,774.54 Depreciation and amortization 7,399,112.21 6,575,595.43 Rent, property, water and electricity 2,790,452.22 2,125,193.98 Business entertainment expenses 1,809,752.38 1,305,653.82 Share-based payment 1,793,962.68 1,507,437.47 Intermediary service fee 1,674,726.72 4,033,569.92 Travel expenses 1,273,848.31 1,112,975.46 Office and communication expenses 883,482.12 1,271,852.57 Others 1,046,975.86 2,401,288.72 Total 41,752,189.89 37,808,341.91

Other instructions: none

46. Sales expenses

Unit: Yuan

Item Amount for the current period Amount for the previous period

Employee compensation 29,504,768.73 22,818,068.74 Travel expenses 6,933,012.14 4,797,968.92 Business entertainment expenses 6,121,329.16 4,176,365.30 Testing service fees 1,122,729.19 2,696,072.65 Share-based payment 898,214.64 986,988.90 Depreciation and amortization 730,565.71 605,786.58 Insurance premium 261,042.72 305,915.04 Others 1,852,117.05 1,574,724.27 Total 47,423,779.34 37,961,890.40

Other instructions: none

47. Research and development expenses

Unit: Yuan

Item Amount for the current period Amount for the previous period

Employee compensation 48,420,020.65 28,916,076.70 Tools and materials 21,909,442.02 12,018,851.32 Depreciation and amortization 5,856,512.10 3,641,423.33 Travel expenses 2,342,271.42 873,575.92 Inspection and maintenance expenses 1,408,518.47 1,498,066.75 Share-based payment 1,218,350.06 1,273,008.62 Transportation and miscellaneous expenses 353,738.35 255,980.66 Others 3,637,925.33 1,941,202.84 Total 85,146,778.40 50,418,186.14

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Other instructions: none

48. Financial expenses

Unit: Yuan

Item Amount for the current period Amount for the previous period

Interest expense 16,301,128.41 9,545,744.10 Including: interest expense on lease liabilities 117,967.95

Less: Interest income 164,193.89 266,560.48 Net interest expense 16,136,934.52 9,279,183.62 Exchange loss 651,219.33 251.09 Less: Exchange gain 21,535.74 Net exchange loss 651,219.33 -21,284.65 Bank fees and others 784,871.78 393,847.56 Total 17,573,025.63 9,651,746.53

Other instructions: none

49. Other income

Unit: Yuan

Sources of other income Amount incurred in the current period Amount incurred in the previous period

1. Government subsidies included in other income 19,087,780.04 12,518,530.48 Including: Government subsidies related to deferred income 17,568,735.26 7,172,358.57 Government subsidies related to deferred income

Government subsidies directly included in current profits and losses 1,519,044.78 5,346,171.91

2. Others related to daily activities and included in other

6,431,024.71 6,967,255.08 Income items

Including: Refund of individual tax withholding fees 173,040.70 104,829.75

Advanced manufacturing deduction 6,257,984.01 6,862,425.33 Total 25,518,804.75 19,485,785.56

50. Net exposure hedging income

51. Income from changes in fair value

Unit: Yuan

Sources of income from changes in fair value Amount incurred in the current period Amount incurred in the previous period

Trading financial assets 6,263,860.48 Total 6,263,860.48

Other instructions: none

52. Investment income

Unit: Yuan

Item Amount for the current period Amount for the previous period

Gains from debt restructuring -40,514.05

Bank acceptance bill discount interest -3,471,190.45 -2,521,387.28 Financial product investment income 311,889.85 377,585.93 Total -3,199,814.65 -2,143,801.35

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Other instructions: none

53. Credit impairment losses

Unit: Yuan

Item Amount for the current period Amount for the previous period

Bad debt losses on notes receivable 596,747.82 21,650.50 Bad debt losses on accounts receivable -19,173,862.14 -30,178,491.49 Bad debt losses on other receivables -116,847.47 -97,038.25 Bad debt losses on long-term receivables -348,045.09 -534,581.89Bad debt losses on non-current assets due within one year -192,026.56 -360,125.10Total -19,234,033.44 -31,148,586.23Other notes: None

54. Asset impairment losses

Unit: Yuan

Item Amount for the current period Amount for the previous period

1. Inventory depreciation losses and contract performance cost deductions

-16,869,559.72 -14,459,568.45 value loss

11. Impairment losses on contract assets 3,575,052.45 43,741.89 Total -13,294,507.27 -14,415,826.56 Other notes: None

12. Income from asset disposal

Unit: Yuan

Source of asset disposal income Amount incurred in the current period Amount incurred in the previous period

Disposal of fixed assets not classified as held for sale,

Gains or losses on disposal of projects under construction, productive biological assets and intangible assets 198,536.02 -109,283.96

Including: Fixed assets 198,536.02 -109,283.96 Total 198,536.02 -109,283.96

56. Non-operating income

Unit: Yuan Financial items included in non-recurring gains and losses for the current period Amount incurred in the current period Amount incurred in the previous period

Um

Income from penalties and confiscation 75,000.00 55,800.04 75,000.00 Others 1,193.59 8,374.72 1,193.59 Total 76,193.59 64,174.76

Other instructions: none

57. Non-operating expenses

Unit: Yuan

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Gold items included in non-recurring profits and losses for the current period Amount incurred in the current period Amount incurred in the previous period

Um

Non-monetary asset exchange losses 650,056.39 566,208.70 650,056.39 External donations 200,000.00 400,880.00 200,000.00 Penalty and confiscation expenses 33,280.00

Late tax payment 56,092.09 123,455.17 56,092.09Others 176,700.00 15,772.40 176,700.00Total 1,082,848.48 1,139,596.27 1,082,848.48Other notes: None

58. Income tax expenses

(1) Income tax expense schedule

Unit: Yuan

Item Amount for the current period Amount for the previous period

Current income tax expense 6,595,036.39 10,075,978.62 Deferred income tax expense 1,774,942.24 -5,221,896.14 Total 8,369,978.63 4,854,082.48

(2) Adjustment process of accounting profits and income tax expenses

Unit: Yuan

Item Amount incurred in this period

Total profit 131,728,661.41 Income tax expenses calculated according to statutory/applicable tax rates 19,759,299.21 The impact of different tax rates applicable to subsidiaries 1,851,915.25 The impact of non-deductible costs, expenses and losses 1,216,743.98 No deductible temporary differences or deductible temporary differences of deferred income tax assets have been recognized in the current period

-The impact of loss of 3,462.88

Impact of additional deductions -14,454,516.93 Income tax expenses 8,369,978.63 Other notes: None

59. Other comprehensive income

See Note 7.40 for details.

60. Cash flow statement items

(1) Cash related to operating activities

Other cash received related to operating activities

Unit: Yuan

Item Amount for the current period Amount for the previous period

Government subsidies received 14,569,044.78 1,982,564.28 Interest income 164,193.89 103,216.81

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Operating capital transactions and others 6,881,827.53 6,979,236.54 Total 21,615,066.20 9,065,017.63

Description of other cash received related to operating activities: None

Other cash paid related to operating activities

Unit: Yuan

Item Amount for the current period Amount for the previous period

Cash sales expenses, administrative expenses and R&D expenses 56,127,262.13 48,400,732.36 Operating fund transactions and others 8,156,975.08 5,882,747.29 Non-operating expenses 432,792.09 573,387.57 Handling fees in financial expenses 782,588.73 393,847.56 Total 65,499,618.03 55,250,714.78

Description of other cash paid related to operating activities: None

(2) Cash related to investing activities

Other cash received related to investing activities: None

Significant cash received related to investing activities: None

Description of other cash received related to investing activities: None

Other cash paid related to investing activities: None

Significant cash payments related to investing activities: None

Description of other cash paid related to investment activities: None

(3) Cash related to financing activities

Other cash received related to financing activities: None

Description of other cash received related to financing activities: None

Other cash paid related to financing activities: None

Unit: Yuan

Item Amount for the current period Amount for the previous period

Payment of principal and interest on lease liabilities 1,900,371.20 2,071,404.61 Listing agency fee 3,311,796.22 0.00 Total 5,212,167.42 2,071,404.61

Description of other cash paid related to financing activities: None

Changes in various liabilities arising from financing activities

Applicable □Not applicable

Unit: Yuan

Increase in this period Decrease in this period

Item Opening balance Closing balance Cash change Non-cash change Cash change Non-cash change

789,866,323. 830,143,834. 107,031,149. 315,491,731. 1,411,549,57 short-term borrowings

73 07 38 87 5.31 Long-term borrowings (including

182,610,627. 87,827,257.1 66,815,390.3 206,295,006. Due within one year 2,672,511.67

65 7 8 11 long-term borrowing)

Lease liabilities (including

Lease liabilities due within one year 7,503,961.10 117,967.95 1,900,371.20 5,721,557.85

979,980,912. 917,971,091. 109,821,629. 384,207,493. 1,623,566,13Total

48 24 00 45 9.27

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

61. Supplementary information for cash flow statement

(1) Supplementary information for cash flow statement

Unit: Yuan

Supplementary information Amount for the current period Amount for the previous period

1． Adjust net profit to cash flow from operating activities

Quantity:

Net profit 123,358,682.78 68,295,463.35 plus: asset impairment provision 32,528,540.71 45,564,412.79 Depreciation of fixed assets, depreciation of oil and gas assets

42,492,722.90 27,633,997.19 Depreciation of consumption and productive biological assets

Depreciation of right-of-use assets 1,845,444.84 867,634.92 Amortization of intangible assets 2,338,926.57 1,568,288.70 Amortization of long-term prepaid expenses 8,958,519.17 3,382,788.82 Disposal of fixed assets, intangible assets and other

Loss of other long-term assets (income is listed with "-" sign -198,536.02 109,283.96)

Loss on scrapping of fixed assets (income based on

650,056.39 566,208.70 (Fill in “-”)

Loss from change in fair value (gain based on

-6,263,860.48 “-” (please fill in the column)

Financial expenses (revenues are filled in with "-"

16,301,128.41 9,382,400.43 columns)

Investment losses (income is filled in with "-"

-311,889.85 617,222.67 columns)

Deferred tax assets decreased (increased by

2,080,059.65 -4,421,748.42 (Fill in “-”)

Deferred tax liabilities increased (decreased by

-305,117.40 -800,147.72 (Fill in “-”)

Decrease in inventory (increase marked with "-"

-263,267,433.98 -229,185,330.81 fill in the column)

Decrease in operating receivables (increase in

-638,068,166.20 -471,240,579.17 (please fill in the list with "-")

Increase (decrease) in operating payables

751,834,075.08 486,934,050.26 (please fill in with "-")

Others 4,647,234.09 5,343,058.38 Net cash flow generated from operating activities 84,884,247.14 -61,646,856.43 2. Major investments and financing that do not involve cash receipts or payments

Activities:

debt to capital

Convertible corporate bonds due within one year

Financing leased fixed assets

3. Net changes in cash and cash equivalents:

Closing balance of cash 590,241,376.53 288,836,242.91 Less: Opening balance of cash 262,251,714.40 109,077,744.17 Add: Closing balance of cash equivalents

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Less: Opening balance of cash equivalents

Net increase in cash and cash equivalents 327,989,662.13 179,758,498.74

(2) Composition of cash and cash equivalents

Unit: Yuan

Item Ending balance Beginning balance

1. Cash 590,241,376.53 262,251,714.40 Including: cash on hand 24,232.70 51,472.20

Bank deposits available for payment at any time 590,217,143.83 288,784,770.71

3. Balance of cash and cash equivalents at the end of the period 590,241,376.53 262,251,714.40

4. Foreign currency monetary items

(1) Foreign currency monetary items

Unit: Yuan

Items Foreign currency balance at the end of the period Conversion exchange rate Conversion of RMB balance at the end of the period Monetary Funds

Including: USD 4,865,867.90 6.8109 33,140,939.68 Euros

Hong Kong dollar

Thai Baht 1,239,476.58 0.2042 253,101.12Accounts receivable

Of which: USD 5,158.00 6.8109 35,130.62 EUR

Hong Kong dollar

long term borrowing

Of which: US dollars

Euro

Hong Kong dollar

Other receivables

Including: Thai Baht 525,200.00 0.2042 107,245.84 Other current assets

Including: Thai Baht 21,240.80 0.2042 4,337.37 Other instructions: None

(2) The nature of the lack of currency convertibility and its financial impact, the spot exchange rate used and its estimation process, and the risks faced by the enterprise due to the lack of currency convertibility

□Applicable Not applicable

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

(3) Description of overseas operating entities, including for important overseas operating entities, their main overseas business location, accounting standard currency and basis for selection should be disclosed. If the accounting standard currency changes, the reasons should also be disclosed.

□Applicable Not applicable

(4) Lack of convertibility between the accounting standard currency of overseas operations and the enterprise’s presentation currency

□Applicable Not applicable

63. Leasing

(1) The company serves as the lessee

Applicable □Not applicable

Variable lease payments not included in the measurement of lease liabilities

□Applicable Not applicable

Simplified treatment of short-term leases or lease payments for low-value assets

Applicable □Not applicable

Item Amount from January to June 2026 Amount from January to June 2025 The amount from January to June 2025 is included in the current profit and loss for the current period and adopts simplified treatment.

1,685,997.41 1,081,867.28 leasing expenses

Interest expense on lease liabilities 117,967.95 - Total cash outflows related to leases 7,230,759.79 4,864,428.39 Situations involving sale and leaseback transactions: None

(2) The company as the lessor

Operating lease as lessor

Applicable □Not applicable

Unit: Yuan Including: Variable lease items not included in lease receipts Lease income

Payment related revenue

Lease income 6,084,947.93

Total 6,084,947.93

Finance lease as lessor

□Applicable Not applicable

Undiscounted lease payments for each of the next five years

Applicable □Not applicable

Unit: Yuan Annual undiscounted lease receipts

Project

Ending amount Beginning amount

First year 9,695,474.68 18,503,642.17 Second year 7,026,647.25 17,738,812.00 Third year 3,982,536.00 11,137,444.25

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Fourth year 3,154,480.00 9,206,336.00 Fifth year 201,400.00 8,745,512.00

Reconciliation of undiscounted lease receipts to net lease investment: None

(3) Recognizing financial lease sales profits and losses as a manufacturer or distributor

□Applicable Not applicable

8. R&D expenditures

Unit: Yuan

Item Amount for the current period Amount for the previous period

Employee compensation 48,420,020.65 28,916,076.70 Tools and materials 21,909,442.02 12,018,851.32 Depreciation and amortization 5,856,512.10 3,641,423.33 Travel expenses 2,342,271.42 873,575.92 Inspection and maintenance expenses 1,408,518.47 1,498,066.75 Share-based payment 1,218,350.06 1,273,008.62 Transportation and miscellaneous expenses 353,738.35 255,980.66 Others 3,637,925.33 1,941,202.84 Total 85,146,778.40 50,418,186.14 Including: Expenditure R&D expenditure 85,146,778.40 50,418,186.14

Capitalized R&D expenditures 0.00 0.00

9. Changes in consolidation scope

10. Interests in other entities

1. Interests in subsidiaries

(1) Composition of enterprise groups

Unit: Yuan Main business registration Shareholding ratio Name of acquirer’s subsidiary Registered capital Nature of business

Location Direct Indirect Wujiang Green Control Electronic Control Technology Co., Ltd. Suzhou Software development and production

20,000,000.00 Suzhou City 100.00% Establishment of Division City Manufacturing and Sales

Suzhou Green Control New Energy Technology Co., Ltd. Suzhou

120,000,000.00 Suzhou City Production, manufacturing and sales 100.00% Company establishment City

Suzhou Green Control Precision Manufacturing Co., Ltd. Suzhou

24,000,000.00 Suzhou City Manufacturing and Sales 100.00% Establishment Division City

Suzhou Green Control Green Capacity Vehicle Co., Ltd. Suzhou

20,000,000.00 Suzhou City Sales, leasing 100.00% Establishment of a limited company City

Green Control Transmission Technology (Yancheng) has Yancheng

40,000,000.00 Yancheng City Production, manufacturing and sales 100.00% Establishment of a limited company City

Green Control Transmission Technology (Nantong) has Nantong

100,000,000.00 Nantong City Production, manufacturing and sales 100.00% Establishment of a limited company City

Green Control Transmission Technology (Hong Kong) has

1,820,740.00 Hong Kong Hong Kong Export trade 100.00% Establishment of a limited company

Green Control Transmission Technology (Thailand) has 437,962.60 Thailand Thailand Production, manufacturing and sales 100.00% established

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Ltd.

Explanation on the difference between the proportion of shareholding in subsidiaries and the proportion of voting rights: Not applicable

Basis for holding half or less of the voting rights but still controlling the invested unit, and holding more than half of the voting rights but not controlling the invested unit: Not applicable

For important structured entities included in the scope of consolidation, the basis of control: Not applicable

Basis for determining whether a company is agent or principal: Not applicable

Other instructions: none

11. Government subsidies

1. Government subsidies recognized according to the amount receivable at the end of the reporting period

□Applicable Not applicable

Reasons for failure to receive the estimated amount of government subsidy at the estimated time

□Applicable Not applicable

2. Liability items involving government subsidies

Applicable □Not applicable

Unit: Yuan Included in the current period

New additions in this period are transferred to other changes and assets/receipts in this period. Beginning balance of the period. Non-professional income. Ending balance of the period.

Amount of subsidy Amount of other income Motivation Amount of beneficiary

129,006,02 13,050,000 17,568,735 124,487,29

Deferred income related to assets

5.72 .00 .26 0.46

3. Government subsidies included in current profits and losses

Applicable □Not applicable

Unit: Yuan

Accounting accounts Amount for the current period Amount for the previous period

Other income 1,519,044.78 5,346,171.91Other instructions: None

12. Risks related to financial instruments

1. Various risks arising from financial instruments

The Company's risks related to financial instruments originate from various financial assets and financial liabilities recognized by the Company in the course of its operations, including: credit risk, liquidity risk and market risk.

The management of the Company is responsible for the management objectives and policies of the Company's various risks related to financial instruments. The operating management is responsible for daily risk management through functional departments (for example, the company's credit management department reviews the company's credit sales one by one). The Company's internal audit department conducts daily supervision on the implementation of the Company's risk management policies and procedures, and reports relevant findings to the Company's Audit Committee in a timely manner.

The overall goal of the company's risk management is to formulate risk management policies that reduce risks related to various financial instruments as much as possible without unduly affecting the company's competitiveness and resilience.

credit risk

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Credit risk refers to the risk that one party to a financial instrument fails to perform its obligations, resulting in financial losses to the other party. The Company's credit risk mainly arises from monetary funds, notes receivable, accounts receivable, receivable financing, other receivables, contract assets, debt investments and long-term receivables. The credit risk of these financial assets originates from counterparty default, and the maximum risk exposure is equal to the carrying amount of these instruments.

The company's monetary funds are mainly deposited in financial institutions such as commercial banks. The company believes that these commercial banks have high reputation and asset status and have low credit risks.

For notes receivable, accounts receivable, receivable financing, other receivables, contract assets, debt investments and long-term receivables, the Company sets relevant policies to control credit risk exposure. The company evaluates the customer's credit qualifications and sets corresponding credit periods based on the customer's financial status, the possibility of obtaining guarantees from third parties, credit records and other factors such as current market conditions. The company will regularly monitor customer credit records. For customers with poor credit records, the company will use written reminders, shorten the credit period or cancel the credit period to ensure that the company's overall credit risk is within a controllable range.

(1) Judgment criteria for significant increase in credit risk

The Company assesses on each balance sheet date whether the credit risk of relevant financial instruments has increased significantly since initial recognition. When determining whether credit risk has increased significantly since initial recognition, the Company considers reasonable and evidence-based information that can be obtained without unnecessary additional cost or effort, including qualitative and quantitative analysis based on the Company's historical data, external credit risk ratings, and forward-looking information. Based on a single financial instrument or a combination of financial instruments with similar credit risk characteristics, the Company determines the changes in default risk during the expected duration of the financial instrument by comparing the risk of default of the financial instrument on the balance sheet date with the risk of default on the initial recognition date.

When one or more of the following quantitative and qualitative criteria are triggered, the Company believes that the credit risk of financial instruments has increased significantly: the quantitative criteria are mainly that the default probability of the remaining duration on the reporting date has increased by more than a certain percentage compared with the initial recognition; the qualitative criteria are that there are major adverse changes in the operating or financial conditions of the main debtor, the list of early warning customers, etc.

(2) Definition of credit-impaired assets

In order to determine whether credit impairment has occurred, the definition standards adopted by the Company are consistent with the internal credit risk management objectives for relevant financial instruments, while taking into account quantitative and qualitative indicators.

When the company assesses whether a debtor has suffered credit impairment, it mainly considers the following factors: the issuer or the debtor encounters major financial difficulties; the debtor breaches the contract, such as default or overdue payment of interest or principal; the creditor gives the debt due to economic or contractual considerations related to the debtor's financial difficulties; Concessions that a person would not make under any other circumstances; the debtor is likely to go bankrupt or undergo other financial reorganization; financial difficulties of the issuer or debtor result in the disappearance of an active market for the financial asset; purchase or origination of a financial asset at a substantial discount that reflects the fact that a credit loss has occurred.

Credit impairment of financial assets may be caused by the combined effect of multiple events and may not be caused by an individually identifiable event.

(3) Parameters for measuring expected credit losses

Depending on whether there is a significant increase in credit risk and whether credit impairment has occurred, the company measures impairment provisions for different assets based on expected credit losses for 12 months or the entire duration. Key parameters for measuring expected credit losses include probability of default, loss given default rate and exposure to default risk. The Company considers quantitative analysis and forward-looking information of historical statistical data (such as counterparty ratings, guarantee methods and collateral types, repayment methods, etc.) to establish default probability, default loss rate and default risk exposure models.

The relevant definitions are as follows:

The probability of default refers to the possibility that the debtor will be unable to fulfill its payment obligations in the next 12 months or throughout the remaining duration.

Loss given default refers to the Company’s expectation of the extent of loss due to default risk exposure. LGDs vary depending on the type of counterparty, the method and priority of recourse, and the collateral. The loss given default rate is the percentage of risk exposure loss when a default occurs, calculated based on the next 12 months or the entire duration;

Default risk exposure refers to the amount that the company will be reimbursed if a default occurs in the next 12 months or throughout the remaining duration. Forward-Looking Information The assessment of significant increases in credit risk and the calculation of expected credit losses involve forward-looking information. Through historical data analysis, the Company identifies key economic indicators that affect the credit risk and expected credit losses of each business type.

The Company's maximum exposure to credit risk is the carrying amount of each financial asset on the balance sheet. The Company has not provided any other guarantees that may expose the Company to credit risk.

As of June 30, 2026, among the company's accounts receivable, the accounts receivable of the top five customers accounted for 57.82% of the company's total accounts receivable (December 31, 2025: 58.7 6%); among the Company's other receivables, the other receivables of the top five companies in terms of arrears accounted for 68.93% of the Company's total other receivables (December 31, 2025: 81.93%).

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Liquidity risk

Liquidity risk refers to the risk of a shortage of funds when an enterprise fulfills its obligations to settle by delivering cash or other financial assets. The company is responsible for the overall cash management of all subsidiaries within the company, including short-term investment of cash surplus and raising loans to meet expected cash needs. The Company's policy is to regularly monitor short-term and long-term liquidity requirements and compliance with borrowing agreements to ensure that adequate cash reserves and marketable securities are readily liquidated. The maturity period of the Company’s financial liabilities at the end of the period is as follows:

June 30, 2026

Project name

Within 1 year 1-2 years 2-3 years Short-term loan over 3 years

1,411,549,575.31 - - - Notes payable

429,774,053.75 - - -Accounts payable

1,648,141,769.58 - - -Other payables

79,039,941.58 - - - Lease liabilities

• 1,970,960.68 - -Long-term borrowings

• 60,487,451.80 23,126,229.08 41,121,629.46 Non-current liabilities due within one year

85,310,292.94 - - -Total

3,653,815,633.16 62,458,412.48 23,126,229.08 41,121,629.46

(Continued from above table)

December 31, 2025

Project name

Within 1 year 1-2 years 2-3 years More than 3 years

Short-term borrowings 789,866,323.73 - - -

144,036,515.72

Notes payable - - - Accounts payable 1,488,768,052.92 - - - Other payables 72,674,092.70 - - - Lease liabilities - 3,907,071.36 - - Long-term borrowings - 39,286,966.60 - 10,318,299.38 Non-current liabilities due within one year 136,602,251.41 - - -Total 2,631,947,236.48 43,194,037.96 - 10,318,299.38 Market risk

(1) Interest rate risk

The Company's interest rate risk mainly arises from short-term bank borrowings, long-term bank borrowings and other interest-bearing debts. Financial liabilities with floating interest rates expose the Company to cash flow interest rate risk, while financial liabilities with fixed interest rates expose the Company to fair value interest rate risk. The Company determines the relative proportion of fixed-rate and floating-rate contracts based on the prevailing market environment.

The financial department of the company's headquarters continues to monitor the group's interest rate levels. Rising interest rates will increase the cost of new interest-bearing debt and the interest expenses of the company's unpaid interest-bearing debt with floating interest rates, and will have a significant adverse impact on the company's financial performance. Management will make timely adjustments based on the latest market conditions.

As of June 30, 2026, with other risk variables remaining unchanged, if the borrowing rate calculated at floating interest rates increases or decreases by 10 basis points, the company's net profit for the current period will decrease or increase by RMB 213,600.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

2. Hedging

(1) The company carries out hedging business for risk management

□Applicable Not applicable

(2) The company carries out hedging business for risk management and expects to achieve risk management objectives but does not apply hedging accounting

□Applicable Not applicable

3. Financial assets

(1) Classification of transfer methods

Applicable □Not applicable

Unit: yuan transferred financial assets transferred financial assets

Transfer method Termination of confirmation Basis for judgment of termination of confirmation

Nature of property Amount

Due to the low credit rating of the accepting bank in the notes receivable, the endorsement/discount notes receivable 623,162,869.28 has not been derecognized due to the existence of credit risk and deferred payment risk, so it has not been derecognized.

Since the credit rating of the accepting bank in receivables financing is higher than that of endorsement/discount receivables financing 1,294,182,238.09 Derecognition, the credit risk and deferred payment risk are smaller, so it is derecognized.

Total 1,917,345,107.37

(2) Financial assets derecognized due to transfer

Applicable □Not applicable

Unit: yuan Gain or loss items related to derecognition Method of transferring financial assets Amount of financial assets derecognized

lost

Receivables financing endorsement/discount 1,294,182,238.09 3,471,190.45

Total 1,294,182,238.09 3,471,190.45

(3) Asset transfer financial assets that continue to be involved

□Applicable Not applicable

Other instructions: none

13. Disclosure of fair value

1. Closing fair value of assets and liabilities measured at fair value

Unit: Yuan Ending Fair Value

Item Level 1 fair value measurement Second level fair value measurement Third level fair value measurement

total

quantity quantity quantity

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

1. Sustained fair value

---

Measurement

(2) Other debt investments 36,551,764.14 36,551,764.14

(3) Financing of receivables 55,160,805.74 55,160,805.74 Continue to be measured at fair value

Total assets of 91,712,569.88 91,712,569.88

2. Non-sustainable fair price

---

value measurement

2. Basis for determining the market price of continuous and non-continuous first-level fair value measurement items

None

3. Continuous and non-continuous second-level fair value measurement items, valuation techniques used and qualitative and quantitative information on important parameters

None

4. Continuous and non-continuous third-level fair value measurement items, valuation techniques used and qualitative and quantitative information on important parameters. The remaining financing period of the company's ending receivables is short, the book value is similar to the fair value, and the book value is used as the fair value.

The Company's other equity instrument investments at the end of the period are equity investments in unlisted companies held at fair value and changes included in other comprehensive income, and are measured with investment cost as a reasonable estimate of fair value.

5. Continuous third-level fair value measurement items, reconciliation information between the opening and closing book values and sensitivity analysis of unobservable parameters

None

6. For ongoing fair value measurement items, if there is a conversion between various levels during the current period, the reasons for the conversion and the policy for determining the time of conversion

None

7. Valuation technology changes that occurred during the current period and reasons for the changes

None

8. Fair value of financial assets and financial liabilities not measured at fair value

None

14. Related parties and related transactions

1. Information about the company’s subsidiaries

Please refer to Note 10.1 for details of the company's subsidiaries.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

2. Situation of the Company’s joint ventures and associated enterprises

3. Other related parties

Names of other related parties Relationship between other related parties and the company

He Guowang, a shareholder who together with Li Shanshan held more than 5% of the shares of Green Control Transmission, once served as Vice Chairman of Green Control Transmission

(Resigned in March 2025), Secretary of the Board of Directors (Resigned in July 2025) Li Shanshan Shareholders who together with He Guowang held more than 5% of the shares of Green Control Transmission

Song Peng, a shareholder who together with Wei Junmin held more than 5% of the shares of Green Control Transmission

Wei Junmin, a shareholder who together with Song Peng held more than 5% of the shares of Green Control Transmission

Huang Yimin and Liu Jingxia are husband and wife. Guan Fengyu and Guanxin Venture Capital are companies jointly controlled by the two. The shareholding ratio of Huang Yimin is

Calculated on a combined basis, the aforementioned entities hold a total of 5.9155% of the shares of Green Control Transmission

Huang Yimin and Liu Jingxia are husband and wife. Guan Fengyu and Guanxin Venture Capital are companies jointly controlled by the two. Their shareholding ratio should be that of Liu Jingxia.

Calculated on a combined basis, the aforementioned entities hold a total of 5.9155% of the shares of Green Control Transmission

Huang Quanan Deputy General Manager

Yi Xiangming Independent Director

Yu Shuguang Independent Director

Zhang Ning once served as an independent director of Green Control Transmission and will no longer serve as an independent director after March 2025.

Mei Shenshi used to be an independent director of Green Control Transmission and will no longer serve as an independent director after March 2025.

Cao Jingyu, Secretary of the Board of Directors, Assistant to the General Manager

Chen Youfei used to be a supervisor. The board of supervisors was canceled in March 2026.

Liu Yongrui Director

Lu Jianjun Vice Chairman, Director, Deputy General Manager

Lu Tingke (Lu Xiaoke) used to be a supervisor. The supervisory board was canceled in March 2026.

Wang Jinhuai Financial Director

Huaye Testing Technology Services Co., Ltd. A company where Wang Shaoming serves as a director

Beijing Chuangxin Hengyuan Technology Co., Ltd. A company in which Wei Junmin’s spouse Song Jian serves as executive director and manager and holds 95.00% of the shares Beijing Jingwei Hengrun Technology Co., Ltd. A company in which Wei Junmin’s spouse Song Jian serves as executive director

Other instructions: none

4. Related transactions

(1) Related transactions related to the purchase and sale of goods, provision and receipt of services

Procurement of goods/service acceptance form

Unit: Yuan

Whether the transaction amount is exceeded Related party Content of related transactions Amount incurred in the current period Approved transaction limit Amount incurred in the previous period

degree

List of goods sold/services provided

Unit: Yuan

Related parties Contents of related transactions Amount incurred in the current period Amount incurred in the previous period Huaye Testing Technology Services Co., Ltd. Technical service fee 37,754.72 410,986.63Beijing Jingwei Hengrun Technology Co., Ltd.

Sales of electric drive systems 206,725.68 350,442.48 Company

Beijing Jingwei Hengrun Technology Co., Ltd.

Technical service fee 43,584.91 company

Description of related-party transactions for purchasing and selling goods, providing and receiving services: None

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

(2) Related leasing situation

As a lessor, our company:

Unit: Yuan

Name of lessee Type of leased assets Lease income recognized in the current period Lease income recognized in the previous period Huaye Testing Technology Services Co., Ltd. Rent and water and electricity 1,103,148.55 1,431,683.91

(3) Related guarantees

The company serves as the guarantor: None

The company as the guaranteed party

Unit: Yuan

Whether the guarantee has been fulfilled by the guarantor, the guarantee amount, the guarantee starting date, the guarantee expiry date

Bi Li Lei, Wang Wenwen 280,000,000.00 April 18, 2023 January 30, 2029 No Li Lei, Wang Wenwen 30,000,000.00 February 14, 2025 March 26, 2029 No Li Lei 30,000,000.00 May 19, 2025 September 28, 2028 No Wang Wenwen 30,000,000.00 May 19, 2025 September 28, 2028 No Li Lei 10,000,000.00 May 9, 2025 May 14, 2029 No Wang Wenwen 10,000,000.00 May 9, 2025 May 14, 2029 No Li Lei 96,000,000.00 September 1, 2022 October 22, 2027 No Wang Wenwen 96,000,000.00 September 1, 2022 October 22, 2027 No Li Lei 20,000,000.00 October 11, 2023 October 11, 2026 No Wang Wenwen 20,000,000.00 October 11, 2023 October 11, 2026 No Li Lei, Wang Wenwen 15,000,000.00 January 13, 2023 February 7, 2027 No Li Lei 96,000,000.00 February 1, 2024 February 1, 2027 No Wang Wenwen 96,000,000.00 February 1, 2024 February 1, 2027 No Li Lei 96,000,000.00 March 20, 2025 March 20, 2028 No Wang Wenwen 96,000,000.00 March 20, 2025 March 20, 2028 No Li Lei, Wang Wenwen 50,000,000.00 May 1, 2025 May 1, 2028 No Li Lei 10,000,000.00 September 27, 2024 September 27, 2027 No Li Lei, Wang Wenwen 50,000,000.00 March 7, 2023 March 06, 2027 No Li Lei, Wang Wenwen 50,000,000.00 December 26, 2024 February 16, 2029 No Li Lei, Wang Wenwen 30,000,000.00 February 19, 2026 June 12, 2029 No Li Lei 50,000,000.00 June 25, 2023 September 13, 2027 No Wang Wenwen 50,000,000.00 June 25, 2023 September 13, 2027 No Li Lei, Wang Wenwen 100,000,000.00 April 28, 2025 June 12, 2029 No Li Lei, Wang Wenwen 30,000,000.00 December 7, 2022 July 27, 2029 No Li Lei, Wang Wenwen 10,000,000.00 February 26, 2026 February 26, 2029 No

Description of related guarantees: None

(4) Remuneration of key management personnel

Unit: Yuan

Item Amount for the current period Amount for the previous period Remuneration of key management personnel 3,874,647.47 4,201,114.98

(5) Other related transactions

None

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

5. Accounts receivable and payable from related parties

(1) Items receivable

Unit: Yuan Ending balance Beginning balance

Project name Related parties

Book balance Provision for bad debts Book balance Provision for bad debts

Huaye Testing Technical Service

Accounts receivable 709,857.82 35,492.89 1,145,781.57 57,289.08

Services Co., Ltd.

(2) Items payable

Unit: Yuan

Project name Related parties Book balance at the end of the period Book balance at the beginning of the period Accounts payable Huaye Testing Technology Services Co., Ltd. 19,500.00 Other payables Reimbursements from directors, supervisors and senior management 35,153.64 2,870.00

15. Share-based payment

1. Overall situation of share-based payment

□Applicable Not applicable

2. Equity-settled share-based payment

Applicable □Not applicable

Unit: Yuan

Method for determining the fair value of equity instruments on the grant date based on the latest capital increase price from external investors or based on an evaluation close to the grant date

The right value is used to confirm the fair value of the company’s shares subscribed.

Important parameters of fair value of equity instruments on grant date None

Basis for determining the number of exercisable equity instruments Transfer agreement and capital increase agreement

Reasons for significant differences between the current period’s estimate and the previous period’s estimate None

The cumulative amount of equity-settled share-based payment included in capital reserves 185,797,283.07 Total expenses recognized for equity-settled share-based payment in the current period 4,647,234.09 Other notes: None

3. Share-based payment settled in cash

□Applicable Not applicable

4. Share-based payment expenses for this period

Applicable □Not applicable

Unit: Yuan

Category of grant objects Equity-settled share-based payment expenses Cash-settled share-based payment expenses The directors, senior management and the board of directors deem necessary

4,647,234.09 0.00Other personnel to be motivated

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Total 4,647,234.09 0.00Other instructions: None

5. Modification and termination of share-based payment

Employees Zhang Erjia and Mao Jiannan of the company's shareholding platform Suzhou Green Control No. 1 Investment Center (Limited Partnership) resigned in April 2026.

16. Commitments and contingencies

1. Important commitments

Important commitments existing at the balance sheet date

As of June 30, 2026, the Company has no major commitments that need to be disclosed.

2. Contingent matters

(1) Important contingencies existing on the balance sheet date

As of June 30, 2026, the company has no other major contingencies that need to be disclosed.

(2) If the company has no important contingencies that need to be disclosed, this should also be explained.

The company has no important contingencies that need to be disclosed.

17. Events after the balance sheet date

1. Important non-adjustment matters

Unit: Yuan Items that have an impact on financial status and operating results. Contents. Reasons why the impact cannot be estimated. Number of effects.

On August 20, 2026, the company’s first

Issuance of stocks and bonds Secondary public offering of stocks and listing on GEM 515,205,146.13

Listed. Impact on net proceeds raised.

2. Description of other post-balance sheet events

None

18. Other important matters

1. Debt restructuring

None

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

2. Annuity plan

None

3. Other important transactions and matters that have an impact on investors’ decision-making

None

4. Others

19. Notes on main items of the parent company’s financial statements

1. Accounts receivable

(1) Disclosure based on aging

Unit: Yuan

Aging Book balance at the end of the period Book balance at the beginning of the period

Within 1 year (including 1 year) 1,822,326,793.47 1,576,179,431.03 1 to 2 years 76,341,939.20 52,634,489.47 2 to 3 years 16,783,404.56 32,322,262.73 More than 3 years 43,826,224.82 22,916,248.23 3 to 4 years 26,640,627.27 7,092,261.93 4 to 5 years 4,785,458.07 4,407,989.75

More than 5 years 12,400,139.48 11,415,996.55 Total 1,959,278,362.05 1,684,052,431.46

(2) Classified disclosure according to bad debt accrual method

Unit: Yuan Ending balance Beginning balance

Book balance Provision for bad debts Book balance Provision for bad debts

Category Book price Book price provision ratio Provision ratio

Amount Ratio Amount Value Amount Ratio Amount Value

Example Example

By item

bad provision

41,791, 35,165, 6,626,0 44,267, 31,474, 12,793, Account provision 2.13% 84.15% 2.63% 71.10%

Receivables of 673.20 628.25 44.95 474.25 379.94 094.31

Accounts

its

Medium:

by combination

Bad provision 1,917,4 1,817,2 1,639,7 1,554,4

100,209 85,317,

Account provision 86,688. 97.87% 5.23% 76,872. 84,957. 97.37% 5.20% 67,007.

,815.91 949.53

Accounts receivable 85 94 21 68

its

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Medium:

1. Merge

Within range 137,932 137,932 100,998 100,998

7.04% 6.00%

correlation ,658.74 ,658.74 ,423.04 ,423.04 square

2.Merge

1,779,5 1,679,3 1,538,7 1,453,4Out of range 100,209 85,317,

54,030. 90.83% 5.63% 44,214. 86,534. 91.37% 5.54% 68,584. Others, 815.91 949.53

11 20 17 64 customers

1,959,2 1,823,9 1,684,0 1,567,2

135,375 116,792

Total 78,362. 100.00% 6.91% 02,917. 52,431. 100.00% 6.94% 60,101. ,444.16 ,329.47

05 89 46 99 Category name of bad debt provision for individual items: Estimated to be unrecoverable

Unit: Yuan Beginning balance Ending balance

Name

Book balance Bad debt provision Book balance Bad debt provision Provision ratio Reason for provision Provision for bad debts is made individually 44,267,474.2 31,474,379.9 41,791,673.2 35,165,628.2 Part of it is not expected to be possible

84.15%

Account preparation 5 4 0 5 Recovery

44,267,474.2 31,474,379.9 41,791,673.2 35,165,628.2

total

5 4 0 5

Category name of provision for bad debts by portfolio: Prudence

Unit: Yuan ending balance

Name

Book balance Bad debt provision Provision ratio

Within 1 year (including 1 year) 1,822,165,909.12 87,106,728.42 4.78% 1 to 2 years 71,051,998.26 1,716,268.02 2.42% 2 to 3 years 9,176,723.07 2,657,016.92 28.95% 3 to 4 years 7,579,273.15 1,943,636.58 25.64% 4 to 5 years 3,633,096.40 2,906,477.12 80.00% More than 5 years 3,879,688.85 3,879,688.85 100.00% Total 1,917,486,688.85 100,209,815.91

Description of basis for determining this combination: None

If bad debt provisions for accounts receivable are made according to the general expected credit loss model:

□Applicable Not applicable

(3) Bad debt provisions accrued, recovered or reversed in the current period

Bad debt provisions for the current period:

Unit: Yuan Amount of changes in the current period

Category Opening balance Ending balance Provision Recovery or transfer Write-off Others

31,474,379.9 35,165,628.2 Individual provision 4,217,069.17 525,820.86

4 5

85,317,949.5 14,891,866.3 100,209,815. Combined provision

3 7 90

116,792,329. 19,108,935.5 135,375,444. Total 525,820.86

47 4 15 Among them, the amount of bad debt provision recovery or reversal in the current period is important: None

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

(4) Accounts receivable actually written off in the current period

Unit: Yuan

Item Write-off Amount

Actual write-off of accounts receivable 525,820.86 Among them, the write-off of important accounts receivable: None

(5) Accounts receivable and contract assets with the top five closing balances collected by debtors

Unit: Yuan accounted for accounts receivable and combined accounts receivable, bad debts, quasi-contract assets at the end of the period, accounts receivable and contract assets

Unit name Closing balance of accounts receivable Closing balance of same assets Provisions and contract assets minus balance Closing balance of production period

Proportion of total value First place in the closing balance of value preparation 335,332,258.15 335,332,258.15 16.91% 16,784,600.45 Second place 331,834,384.45 4,080,000.00 335,914,384.45 16.94% 16,914,842.39 Third place 194,549,458.50 927,700.00 195,477,158.50 9.86% 10,400,272.55 Fourth place 107,395,904.96 107,395,904.96 5.42% 5,378,829.26Fifth place 102,206,922.96 8,116,830.16 110,323,753.12 5.56% 5,548,153.23Total 1,071,318,929.02 13,124,530.16 1,084,443,459.18 54.69% 55,026,697.88

2. Other receivables

Unit: Yuan

Item Ending balance Beginning balance

Other receivables 9,502,916.49 9,153,758.48 Total 9,502,916.49 9,153,758.48

(1) Other receivables

1. Classification of other receivables according to nature of payment

Unit: Yuan

Nature of payment Book balance at the end of the period Book balance at the beginning of the period

Current accounts with related parties within the scope of consolidation 7,553,035.85 7,704,163.51 Guarantees and deposits 1,135,087.50 1,068,184.00 Reserve funds 725,229.07 175,845.56 Loans 400,000.00 400,000.00 Others 21,105.94 26,565.94 Total 9,834,458.36 9,374,759.01

2. Disclosure based on aging

Unit: Yuan

Aging Book balance at the end of the period Book balance at the beginning of the period

Within 1 year (including 1 year) 9,369,043.36 8,909,344.01 1 to 2 years 27,415.00 27,415.00 2 to 3 years 400,000.00 More than 3 years 438,000.00 38,000.00

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

3 to 4 years 400,000.00

More than 5 years 38,000.00 38,000.00 Total 9,834,458.36 9,374,759.01

3. Classified disclosure according to bad debt accrual method

Unit: Yuan Ending balance Beginning balance

Book balance Provision for bad debts Book balance Provision for bad debts

Category Book price Book price provision ratio Provision ratio

Amount Ratio Amount Value Amount Ratio Amount Value

Example Example

Among them:

by combination

9,834,4 331,541 9,502,9 9,374,7 221,000 9,153,7 Bad provision 100.00% 3.37% 100.00% 2.36%

58.36 .87 16.49 59.01 .53 58.48Account preparation

Among them:

merge scope

7,553,0 7,553,0

76.80% 0.00% within

35.85 35.85

Related parties

merge scope

Outside the perimeter 2,281,4 331,541 1,949,8 9,374,7 221,000 9,153,7

23.20% 14.53% 100.00% 2.36%

Other customers 22.51 .87 80.64 59.01 .53 58.48 households

9,834,4 331,541 9,502,9 9,374,7 221,000 9,153,7Total 100.00% 3.37% 100.00% 2.36%

58.36 .87 16.49 59.01 .53 58.48 Category name of bad debt provision by combination: Prudence

Unit: Yuan ending balance

Name

Book balance Bad debt provision Provision ratio

Within 1 year (including 1 year) 9,369,043.36 90,800.37 0.97% 1 to 2 years 27,415.00 2,741.50 10.00% 2 to 3 years 0.00 0.00 30.00% 3 to 4 years 400,000.00 200,000.00 50.00% 4 to 5 years 0.00 0.00 80.00% More than 5 years 38,000.00 38,000.00 100.00% Total 9,834,458.36 331,541.87

Description of what this combination is based on:

Please refer to Note V. 11 for details on the recognition standards and explanation of bad debt provision on a group basis.

Provision for bad debts is made based on the general expected credit loss model:

Unit: Yuan Phase 1 Phase 2 Phase 3

Expected credit throughout the lifetime Credit expected throughout the lifetime

Provision for bad debts Expected credit in the next 12 months Total

Loss (no credit deduction has occurred Loss (credit deduction has occurred)

loss

value) value)

Balance as of January 1, 2026

In this issue

Basis for division of each stage and provision ratio for bad debts

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Changes in book balances with significant changes in loss provision during the period

□Applicable Not applicable

4. Bad debt provisions accrued, recovered or reversed in the current period

Bad debt provisions for the current period:

Unit: Yuan Amount of changes in the current period

Category Beginning Balance Ending Balance

Provision Recovery or transfer Write-off or write-off Others

Bad debt provision 221,000.53 110,541.34 331,541.87 Total 221,000.53 110,541.34 331,541.87

Among them, the amount of bad debt provision for the current period that is reversed or recovered is important: None

5. Other receivables with the top five closing balances collected by debtors

Unit: Yuan accounted for other receivable period

Name of the unit with the ending balance of bad debt provision Nature of the payment Ending balance Aging Total ending balance

Um

Proportion

Association within the scope of consolidation

First place 5,298,541.24 Within 1 year 53.88% 0.00 square meters of current funds

Association within the scope of consolidation

Second place 1,326,122.37 Within 1 year 13.48% 0.00 square meters of current funds

Association within the scope of consolidation

Third place 918,575.92 Within 1 year 9.34% 0.00

Party's current account

Fourth place security deposit and deposit 500,000.00 Within 1 year 5.08% 25,000.00 Fifth place security deposit and deposit 404,706.00 Within 1 year 4.12% 20,235.30 Total 8,447,945.53 85.90% 45,235.30

3. Long-term equity investment

Unit: Yuan Ending balance Beginning balance

Project

Book balance Impairment provision Book value Book balance Impairment provision Book value

328,293,532. 328,293,532. 328,273,532. 328,273,532. Investment in subsidiaries

27 27 27 27

328,293,532. 328,293,532. 328,273,532. 328,273,532.Total

27 27 27 27

(1) Investment in subsidiaries

Unit: Yuan Impairment allowance Increase or decrease in the current period Impairment allowance Opening balance (book value) Closing balance (book price

The investee's provision at the beginning of the provision period is reduced, and its provision at the end of the provision period is reduced (its value at the end of the provision period) is additional investment value)

Balance Investment Value Reserve Other Balance Wujiang Green Control Electronic Control Co., Ltd.

11,250,000.00 11,250,000.00

Technology Co., Ltd.

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Suzhou Green Control New Energy

142,143,532.27 142,143,532.27

Technology Co., Ltd.

Suzhou Green Control Precision Manufacturing

14,900,000.00 14,900,000.00

manufacturing co., ltd.

Suzhou Green Control Green Transport

20,000,000.00 20,000,000.00

Li Automobile Co., Ltd.

Green control transmission technology

40,000,000.00 40,000,000.00

(Yancheng) Co., Ltd.

Green control transmission technology

99,980,000.00 20,000.00 100,000,000.00

(Nantong) Co., Ltd.

Total 328,273,532.27 20,000.00 328,293,532.27

(2) Other instructions

None

4. Operating income and operating costs

Unit: Yuan Amount of current period Amount of previous period

Project

revenue cost revenue cost

Main business 2,310,537,509.26 2,059,289,666.30 1,184,817,834.23 1,068,065,679.88 Other businesses 8,667,014.80 7,823,284.36 4,942,764.78 3,477,493.68 Total 2,319,204,524.06 2,067,112,950.66 1,189,760,599.01 1,071,543,173.56 Decomposition information of operating income and operating costs:

Unit: Yuan Division 1 Total

Contract classification

Operating income Operating cost Operating income Operating cost Business type 2,310,537,509.26 1,973,120,427.48 2,310,537,509.26 1,973,120,427.48 Of which:

Trucks 2,027,736,732.07 1,781,407,913.35 2,027,736,732.07 1,781,407,913.35 Passenger cars 37,604,188.56 22,334,607.56 37,604,188.56 22,334,607.56 Non-road mobile machinery 162,599,627.32 108,478,021.15 162,599,627.32 108,478,021.15 Parts and accessories 57,910,923.86 44,234,292.41 57,910,923.86 44,234,292.41 Technology development and services 11,387,248.86 2,052,368.25 11,387,248.86 2,052,368.25 Others 13,298,788.59 14,613,224.76 13,298,788.59 14,613,224.76 Classified by operating area 2,310,537,509.26 1,973,120,427.48 2,310,537,509.26 1,973,120,427.48

Among them:

Domestic 2,304,073,892.75 1,969,443,114.56 2,304,073,892.75 1,969,443,114.56 Overseas 6,463,616.51 3,677,312.92 6,463,616.51 3,677,312.92Market or customer type

Among them:

Contract type

Among them:

According to the time of commodity transfer

class

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 semi-annual report

Among them:

Classification by contract period

Among them:

Classified by sales channel

Among them:

Total 2,310,537,509.26 1,973,120,427.48 2,310,537,509.26 1,973,120,427.48 Information related to performance obligations: None

Other instructions: none

5. Investment income

Unit: Yuan

Item Amount incurred in the current period Amount incurred in the previous period Financial product investment income 309,575.06 309,099.25 Bank acceptance bill discount interest -3,471,190.45 -2,518,922.82 Gains and losses from debt restructuring -40,514.05Total -3,202,129.44 -2,209,823.57

6. Others

None

20. Supplementary information

1. Detailed statement of non-recurring profits and losses for the current period

Applicable □Not applicable

Unit: Yuan

Item Amount Explanation of gains and losses from disposal of non-current assets -451,520.37 Government subsidies included in current profits and losses (related to the company’s regular

Closely related to regular business operations and in compliance with national policies

1,519,044.78, enjoy according to the determined standards, and benefit the company

Except for government subsidies that have a lasting impact on profits and losses)

Except for effective transactions related to the company’s normal business operations,

In addition to futures hedging business, non-financial enterprises hold financial

Changes in fair value of assets and financial liabilities 311,889.85 Gains and losses and disposal of financial assets and financial liabilities

profit and loss

Gains and losses from debt restructuring -40,514.05 Other non-operating income and

-356,598.50 expenses

Less: Income tax impact 72,241.91 Total 910,059.80 --

Full text of Suzhou Lvkong Transmission Technology Co., Ltd.'s 2026 Semi-Annual Report Details of other profit and loss items that meet the definition of non-recurring profits and losses:

□Applicable Not applicable

The company has no other specific circumstances of profit and loss items that meet the definition of non-recurring profits and losses.

Explanation on defining the non-recurring profit and loss items listed in the "Explanatory Announcement No. 1 on Information Disclosure of Companies Publicly Offering Securities - Non-recurring Profit and Loss" as recurring profit and loss items

□Applicable Not applicable

2. Return on net assets and earnings per share

earnings per share

Profit for the reporting period Weighted average return on equity

Basic earnings per share (yuan/share) Diluted earnings per share (yuan/share) Net income attributable to the company’s ordinary shareholders

12.72% 0.32 0.32Profit

After deducting non-recurring gains and losses, attributable to

12.63% 0.32 0.32 Net profit of the company’s ordinary shareholders

3. Differences in accounting data under domestic and foreign accounting standards

(1) Differences in net profit and net assets in financial reports disclosed in accordance with both international accounting standards and Chinese accounting standards □ Applicable  Not applicable

(2) Differences in net profit and net assets in financial reports disclosed in accordance with both foreign accounting standards and Chinese accounting standards □Applicable Not applicable

(3) Explanation of the reasons for the differences in accounting data under domestic and foreign accounting standards. If differences are adjusted for data that have been audited by an overseas audit institution, the name of the overseas institution should be indicated.

□Applicable Not applicable

4. Others

None